Fact Friday: Do We Really Want to Be Like Texas?

It has been little more than six months since Michigan adopted comprehensive new energy legislation that establishes a smart framework for Michigan’s energy future; but already some in Lansing are trying to push deregulation forward again.

Their latest argument? Deregulation has been good for Texas.

Talk about your tall tales: Let’s take a closer look at Texas and get the facts straight on what partial deregulation has done to electric rates there:

Texans have been living with partial deregulation for over a decade. The numbers from Texas show us just how much more deregulated consumers paid compared to their regulated counterparts in other portions of the state. Texans in deregulated areas would have saved $25 billion from 2002 to 2014 if they had paid the average price in regulated areas. These lost savings amount to more than $5,100 for each residential household!

Rising rates were not the only negative effects of deregulation on Texans. Deregulation could wreak havoc on reliability. Companies are going bankrupt in deregulated areas across Texas because the markets are not valuing baseload generation – like natural gas and nuclear. Panda Temple Power built a state-of-the-art natural gas plant in 2014, but it’s already filing for bankruptcy. And Exelon’s deregulated plant in Texas is being forced to address its mounting debt.

Texas has been building a lot of wind because federal subsidies have supported development. However, as the AMP community knows, we always need a balanced mix of energy, and, while renewables are important, electric supply should always be well-rounded. Sources like natural gas keep the lights on when the wind is not blowing, so if the trend continues, reliability could be a real risk for Texans.

Legislators in Michigan should focus on following the intent and realizing the vision of the energy policy passed last year, instead of continuing to entertain the terrible notion of de-regulation.

We need energy made in Michigan for Michiganders. The last thing we want is to end up like Texas. Let’s get Lansing back on track, choosing Michigan energy that supports Michigan jobs, communities, and reliable energy for businesses and residents alike.