One of the items included in the 2019 Kansas legislature is whether “competitive markets for retail electricity can benefit all Kansas consumers.” Sometimes referred to as retail wheeling, knowing the experience in other states, it is hard to imagine an objective consultant could conclude anything but “buyer beware.”
Retail wheeling would require consumers to choose their provider of electricity. Most likely, your current electric provider would still be responsible for maintaining and operating the poles and wires to deliver electricity, but consumers would need to evaluate different rate plans and carefully select another company to secure the kilowatt-hours needed to keep their lights on.
We regularly hear proponents tout the Texas model and, of the states that have approved retail wheeling, it is probably the most active and could provide some good lessons. Unfortunately, those lessons include brownouts in 2011, 2014 and 2015.
Brownouts are often coupled with higher prices and clearly a market price doesn’t mean a lower price. In Aug. 2019, the Texas wholesale electricity price spiked to $9,000 a megawatt-hour. And it wasn’t a lone event in the Lone Star state. Over a few days, the price averaged $6,537.45, a 36,000% increase.
That same day, Kansas wholesale prices averaged $35 a megawatt-hour. Do we really want to be exposed to such a volatile energy market?
