Texas Pays Higher Electric Rates Than Neighbors

Before the Republicans took over the state leadership in Texas, the electric rates paid by consumers here were among the lowest in the nation. And while the consumers were paying low rates, the power companies were all making money. State regulations made sure a good balance was achieved between rates paid and company profits. It was a system that operated to the benefit of everyone.

But that wasn't good enough for the Republicans. They decided that electric rates must be deregulated. They got away with it, because they assured consumers that deregulation would result in competition, and competition would invoke the magic of free enterprise to lower electric rates for everyone. They either lied or were incredibly stupid.

They overlooked one important thing -- the incredible greed of large corporate entities. The theory was that the free market, through competition, keeps prices low. But the reality is that when there are only a few competitors, it doesn't take those companies long to figure out (whether they talk to each other or not) that keeping prices high makes more money for all of them, and that's just what happened in Texas.

The deregulation, that was supposed to lower electric rates, has actually resulted in much higher electric rates -- regardless of who that electricity is purchased from. Texas residential consumers now pay higher rates than the national average. The national average rate is 12.05 cents per kilowatt hour, while the Texas rate is 12.43 cents per kilowatt hour.

The absurdity of the Texas rates becomes even more apparent when you look at the electric rates in the states surrounding Texas. The rates in those states are significantly lower, while they should be roughly the same. Here are the residential rates in Texas and it's surrounding states (per kilowatt hour):

Texas............................12.43

New Mexico................11.01

Arkansas......................9.87

Oklahoma....................8.59

Louisiana.....................8.12

The truth is that deregulation was not done for the benefit of consumers. The only interest Republicans have in consumers is to help the corporations take more money out of their pockets. The Republicans deregulated electricity so their rich corporate buddies could make record-breaking windfall profits -- and that is exactly what has happened.

This is just another reason why Republican legislators and state officials must be removed from office in the 2010 elections. Electricity must be re-regulated. The Republicans will never do it. Maybe the Democrats will.