Fixed vs. Variable rate electric contracts

[03trubluGT]

I'm currently about to renew my electric contract or seek out cheaper rates.

What is confusing is the variable vs fixed. Some of the variables are at 4.1c kwh and the fixed starts at about 8.1c kwh.

I understand that the price for variable can go up, but is it logical to think it might triple at some time in your contract?

What do you guys go with, fixed or variable?

[mstng86]

I stick with fixed.

But I should have waited, or maybe done more homework. Alot of people on here are about 2 cents/kwh lower than me. I may have timed it wrong.

[347Mike]

I would imagine their fixed rates are forecasted where the rate can flucuate between. The adjustable may come close to or even beat it but is a risk.

I have an adjustable but I am with a Co Op and mine n ever flucuates more than 3 centers in either direction. Not sure if it differs from a non co op.

[03trubluGT]

I stick with fixed.

But I should have waited, or maybe done more homework. Alot of people on here are about 2 cents/kwh lower than me. I may have timed it wrong.

I timed it wrong last time when everything was going up and I locked in at a stupid 14.3c per KWH. Gas was almost $4/gal at the time and I didn't see it coming down.

Now I have the chance to lock in at 8.7c per KWH fixed, but on www.powertochoose.org it is showing variables in the 4 cents per KWH range.

I would imagine their fixed rates are forecasted where the rate can flucuate between. The adjustable may come close to or even beat it but is a risk.

I have an adjustable but I am with a Co Op and mine n ever flucuates more than 3 centers in either direction. Not sure if it differs from a non co op.

I'm not in a COOP.

[Chili]

Matt,

That variable rate could shoot really high during periods of high demand although the bulk of the year you would remain relatively low based on how the markets have been for the last year or so.

There is too much to type but if you want to give me a call this weekend I can walk you through some of it. It can be pretty confusing.

[Chili]

BTW, with the market like it is right now I would be comfortable locking in a fixed rate for anything below 9 cents a kwh, depending on what, if any, other fees are being charged or passed through.

The closer to 8 cents you can get the better, but rates are slightly higher than they were a month or two ago so 8 or below may be difficult to find.

[03trubluGT]

Matt,

That variable rate could shoot really high during periods of high demand although the bulk of the year you would remain relatively low based on how the markets have been for the last year or so.

There is too much to type but if you want to give me a call this weekend I can walk you through some of it. It can be pretty confusing.

BTW, with the market like it is right now I would be comfortable locking in a fixed rate for anything below 9 cents a kwh, depending on what, if any, other fees are being charged or passed through.

The closer to 8 cents you can get the better, but rates are slightly higher than they were a month or two ago so 8 or below may be difficult to find.

I wouldn't mind talking to you in person tonight, but the wife committed us to go down to Ennis to see her sister's family.

[Cooter]

Matt, my limited research (a day if internet searching) has showed that there are trends through the year and a lot of people tend to recommend going for a 1 or 2yr contract signing up in the winter when rates are lower. So it might be worth going on a variable plan for a few months so that you can get hooked up on the winter dip cycle

[Chili]

I wouldn't mind talking to you in person tonight, but the wife committed us to go down to Ennis to see her sister's family.

Like I said, just give me a call sometime this weekend if you want.

[4eyedwillie]

I just locked in a 12 month fixed rate with Direct energy for 8.4 on my new shop. You might check them out.

[Chili]

I just locked in a 12 month fixed rate with Direct energy for 8.4 on my new shop. You might check them out.

What's your annual usage at that shop and what, if any other fees do you pay? I only ask because you may not be getting the same rates for that shop than people can get on a home. That is a pretty good rate for right now though, assuming there aren't other recurring monthly fees.

[Cooter]

I'm with Kinetic. They're a small company and I paid a little extra for 100% green energy. They had great reviews, and I've been really pleased so far. I went with a 6 month policy that will expire this winter.

[ceyko]

I always go fixed, so I can guesstimate what prices are going to be each month on my bill. The variable plans seem attractive though at times, but to me if feels like an ARM to an extent - anything can change. Out of the last 5 years or so - I had one 12 month plan that was higher then what the market was, the other 4 years have been decent for me.

That's my only caveat is I only do 12 month commitments at a time, so if I do buy in too high it's not for all that long over all. The 2-3 cent per kwh really only matters during the hot season (which IS long around here) otherwise bills are fair either way you look at it.

Thanks goodness we're not pay 15 cent per kwh anymore. That sucked.

[4eyedwillie]

What's your annual usage at that shop and what, if any other fees do you pay? I only ask because you may not be getting the same rates for that shop than people can get on a home. That is a pretty good rate for right now though, assuming there aren't other recurring monthly fees.

I'm not sure on the usage yet..I'm just now opening. Shouldn't be to bad AC on 800 sf, air compressor, a couple lifts, inspection machine and a computer. The total fee's were calculated into the 8.4 based on I think 2000 kw. If I fall below a certain usage level (I believe 850 kw) there is a $9.99 extra fee. Thats all I can remember. It's Direct Energy's basic 12 plan.

[Chili]

I'm not sure on the usage yet..I'm just now opening. Shouldn't be to bad AC on 800 sf, air compressor, a couple lifts, inspection machine and a computer. The total fee's were calculated into the 8.4 based on I think 2000 kw. If I fall below a certain usage level (I believe 850 kw) there is a $9.99 extra fee. Thats all I can remember. It's Direct Energy's basic 12 plan.

The ten dollar fee is pretty normal right now but for residential the cutoff is usually 1000 kwh.