Dive Brief:
- Wind power is so cheap in Texas, and the competition for customers so fierce, that many power providers have begun offering special deals that include free electricity during off-peak hours.
- While not a new program, TXU Energy offers customers free power at night in an effort to get customer loads shifted away from peak, expensive hours.
- The deals are made possible by Texas' isolated electric grid and abundance of wind power, the New York Times reports, finding more than 50 retail providers have offered similar deals in recent years.
Dive Insight:
Remember back when nuclear power was going to be too cheap to meter? In Texas, they call that wind.
The state's unique grid is the reason: Texas generates about 10% of its power from wind energy, but at night there is no place for that power to go. The state has also installed smart meters in virtually every home, allowing detailed data to be recorded about when energy is used. And because the state's grid has sparse connections to markets outside its borders, some power providers have taken to giving away the electricity as a way of enticing new customers.
“Texas is head and shoulders above everybody else with really unique packages for the consumer,” DNV GL consultant Soner Kanlier told the New York Times.
TXU is offering free power at night through its "Energy Free Morning and Evenings" program, and the strategy is not new. The utility began the program three years ago and in return, charges higher rates during the day.
“Since 2012, tens of thousands of Texans have enjoyed free electricity all night, every night with TXU Energy Free Nights,” Sydney Seiger, chief marketing officer for the retail electricity provider, said in a statement. “At the same time, other Texans have told us they would love free electricity when their families are getting ready for their busy days and when homework, dinner and other family activities are in high gear.”
The utility expanded the program to include more hours, including the periods from 7 to 10 a.m. and 7 to 10 p.m.
Variable rate electric plans are expanding, allowing utilities to push consumers to shift their load to lower-demand hours. Those plans are growing quickly in Texas, the Times reports. And the plans are savings consumers up $40 to $50 each month, or up to $600 annually off their electric bills.
