Winter Weather Outlook 2011-2012
By Vernon T., December 29, 2011, News, Save Money
2011-2012 Winter Temperatures, courtesy of NOAA ClimateWatch Magazine
The National Oceanic and Atmospheric Administration (NOAA) announced its Winter Weather Outlook 2011-2012 a few weeks before Christmas. Their analysis came as no real surprise for consumers with Texas electricity service. Both dryer and warmer than normal conditions are expected to continue through to summer, 2012. The reason is due to the weather condition known as a “La Niña” which strengthened in the equatorial Pacific Ocean this autumn.
La Niñas are caused by cooler sea-surface temperatures. This cooling contributes to the Pacific Jet Stream meandering northwards. As a result, colder arctic air tends to stay north in Canada, leaving the continental US (particularly the east coast) with moderate winter weather.
La Niñas bring warmer and drier conditions to Texas and the southern US.
Warmer winter weather, however, doesn’t just mean lower winter utility bills for Texas. Most of the upper Midwest and much of the mid-Atlantic states uses natural gas for heat. For example, last January much of the upper Midwest experienced record cold temperatures. Temperatures in Iowa averaged 11.4°F below normal for ten days including wind chills down to -42°F. Add to that a major blizzard that dumped between 12 and 24 inches of snow on the region. All that cold weather forces people to burn lots of natural gas. After all, cold snaps down to -42°F are dangerous.
So far this year, the Midwest and the mid-Atlantic have seen relatively moderate temperatures. Iowa this year is looking at January temps in the upper 30s and lower 40s. Consequently, not as much natural gas is being burned for heat this winter, leaving large amounts in storage. Natural Gas in underground storage is 4 percent above last year’s peak (3629 billion cubic feet) and the current price (as of Dec. 28 at 9:33 am) $3.07 MMbtu.
So, this means what to Texas electricity rates?
Nearly half of Texas electricity is made by natural gas burning generating plants. In short term between now and summer, it is very likely that intermittent cold snaps and snowfalls will regionally spike the price of natural gas by a few cents. Over all, though, the price of natural gas is falling. As a result, Texas electricity prices should remain the same or even briefly lower by April before summer demand kicks in.
And then what?
At the moment, what happens this summer is anyone’s guess. While headlines earlier this month announcing EPA rules that closed several 40 year old coal-fired generation plants, it’s hoped that natural gas power plants will eventually take up the slack. But this kind of change over isn’t going to happen overnight. Already, ERCOT has warned that without Luminant’s old coal generators it will not be able to cover demand this summer —especially since the hot, dry La Niña pattern may continue. Both the Department of Energy (DOE) and EPA have issued statements about ERCOT’s summer reliabilty, but no real haggling between these federal agencies and the power utilities appears to have taken place. In a nut shell, the future is at best uncertain.
The best way to keep your Texas energy bill low is to sign up for a fixed electricity plan this winter. Bounce Energy offers several fixed rate plans that let you lock-in a great rate for a convenient term that fits your lifestyle. If you are looking for a short term fixed plan to get through the winter, have a look at the Easy Fixed 3. If you want a slightly longer term that can carry you through Texas’ challenging summer months this year, then think about the Nifty 9 plan which is a fixed rate plan for 9 months. And if you are looking for a longer, predictable rate, Bounce Energy offers the Tremendous 24 that lets you lock in today’s prices for 24 months —that’s 2 winters and 2 summers.
Remember, Bounce Energy offers three great rewards programs to help customers save. The Bounce Energy Rewards Program lets customers earn rewards such as movie tickets, bill credits, gift cards, companion airfare and more. The 3% Cash Back Rewards gives customers 3% cash back on their previous 12 bills paid on-time. With the American AAdvantage Rewards Program. customers can earn one mile for every $1 paid towards their electricity bill. When customers order their electricity service, they’ll have the option of picking between these three great rewards programs.
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