Ever feel like your electricity bill is mocking you? Or maybe it's not that collective ouch everyone feels when we open our bills and realize we could probably benefit from switching our electricity providers (thank you deregulation). Maybe, just maybe, it's simply a case of needing information on our electricity service, and not knowing where to get it. Previous blogs have detailed and focused on deregulation facts, saving money, switching service and so on, but today I am going to venture into new territory: The Texas electricity glossary.

I found a few confusing terms that I felt would be good for all of us to have a little clarity on. Of course, there are plenty more to peruse within the glossary itself, but I'll post a few just for fun, or functionality, or whichever you may prefer.

Kilowatt-Hour (kWh)
A unit of energy equivalent to one kilowatt (kW) of power expended for one hour of time. The amount of electricity you use each billing period is expressed in terms of a kilowatt-hour, and is noted on your bill.

Duly noted indeed. Kilowatt-hour is especially prominent in rate-plan descriptions and price comparison, so it's a nice little nugget of information.

Retail Electric Provider
A company that sells electricity to customers. All retail electric providers must be certified to do business by the Public Utility Commission of Texas.

Okay, when you research companies in your area, it's important to realize the difference between an energy marketer, or retail electric provider, and the company that maintains and delivers your electricity. Many times in case of outages, your transmission company will be the appropriate contact for information, not the provider who you purchase service from.

Just how important is Texas in the grand ole' energy industry. Consider these statistics from the Energy Information Administration's Texas energy profile:

Tops in total energy production

Tops in oil and gas production

Texas is number one in producing natural gas, totaling nearly one-fourth of the total gas production in the U.S.

1,600 wind farms in West Texas makes the Lone Star State number one in wind power production.

Houston is home to the nation's largest refined product pipeline

One of three power grids in the entire U.S. services Texas.

Numbers don't necessarily tell the true impact of Texas energy. Perhaps it's biggest contribution is in the development of renewable energy, as Texas currently sits in the top five for renewable production. So despite stereotypes of Texas oil tycoons, Texas continually sets a high bar for green energy standards, producing one of the largest wind power portfolios in the U.S., as well as agricultural biomass energy projects that seek to find additional renewable resources.

Before deregulation kicked off in Texas circa 1995, the generation, transmission and distribution, and retail sales of electricity were all provided by one utility company. Oh how times have changed. The Public Utility Commission of Texas (PUC) now regulates the transmission and distribution, so the delivery of your electricity through poles and wires is not handled by your energy company.

Confusing yet? It's actually quite simple. Generation—the production of electricity—was the first aspect of electricity in Texas to become deregulated, providing you and other energy consumers with a ton of options for clean, affordable electricity.

Now comes the final piece of the deregulation puzzle. Electricity companies are responsible for selling electricity to consumers, and providing customer service options to help you manage your monthly bill. Enter competition: Companies benefit from competition, as it opens up additional service areas that before were regulated to a specific utility, and you benefit from lower prices and special products that are a direct result of said competition. It's a reciprocal relationship. Companies compete for your business, and in turn you receive incentives that help you save on your electricity bill.

Even better is the fact that with all of this utility competition, the PUC still protects you from fraudulent or non-competitive business practices, ensuring that your electricity service is reliable, safe and affordable.

One last thing: The only stipulation to Texas electricity deregulation, is that the PUC has yet to open all areas in Texas to competition—mainly due to the ongoing development and organization of the electricity markets in those areas. Fortunately, the PUC offers a deregulation service map as well as the ability to enter your zip code and find out if your area is fully deregulated. Find out today if electricity competition is available in your area, and which company has the flexible rate plans and products that provide you the safest and most reliable electricity service.

Shopping for electricity in Texas shouldn't be a confusing or difficult process. Enjoying the benefits of living in a deregulated electricity market is almost too easy with the competitive prices and products from major energy companies. The key to saving even more on your monthly energy bill is understanding exactly what makes each service unique. With that being said, Texas energy companies have several fixed and variable rate plans that give people like you a ton of great options for electricity
service. So what exactly is the difference between a fixed and variable rate?

Fixed
A fixed rate generally carries a contract term with it, meaning you can lock in your price on a monthly basis after signing a contract. Terms generally run 12 months. The advantage of a fixed rate plan is that your price doesn't fluctuate when the rest of the electricity market does. Think of a fixed rate as sort of a security blanket.

Variable
Variable rates do change based on the several factors, most especially demand. During hot summer days or cold winter nights you'll often see price spikes as electricity use increases. The advantage to having a variable rate plan is that you can cancel your service at any time, and the monthly and cancellation fees are often very low.

Regardless of what you choose, living in a state that gives you power to find the service that meets your individual electricity needs is a wonderful thing.