Severe weather could lead to energy price spike

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By Arthur Murray January 30th, 2019
For business

You survived the Polar Vortex/bombgenesis/bomb cyclone during the first days of 2018. Now, a year later, an even more powerful polar vortex threatens 90 million people across the Midwest and Northeast. As the snow swirls outside and the temperatures plunge, consider how this system will affect your upcoming electricity bills.

RELATED: Energy assistance programs for low-income customers

The snow and cold mean that many energy customers have their heating systems turned up to 11. There are two consequences:

  • Using more energy means bills will go up regardless of your energy rate. That will affect this month’s energy bills.
  • Using more energy means natural gas and other means of powering generation plants will be in greater demand, meaning wholesale prices could spike. That could affect energy bills for months to come.

The latter could mean hikes in retail energy – the kind you buy in deregulated states – are coming.

What can you do about it?

People who will be most affected by increases are those customers of variable rate energy plans. Prices can change month-to-month depending on wholesale energy and energy commodity prices.

The good news. You can switch from a variable rate plan to a fixed rate plan – where you pay the same rate per kilowatt hour (kWh) used throughout the term of the plan. Terms can last from six months to three years or more. It is important to remember that these fixed rate plans usually include early termination fees, so make sure you’re comfortable with that.

Enter your ZIP code above to see what’s available in your area.

The other thing you can, regardless of your energy plan, is to practice energy saving tips.

In the meantime, stay warm and stay safe.

RELATED: 10 Energy-Saving Tips to Survive the Winter

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