Question: What is your plan for DME's monopoly and price gouging?
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Karen DeVINNEY
I’m not sure where “price gouging” comes up. When I checked prices online, DME was firmly in the middle of price plans in our area. Using the summer rate, including Energy Cost Adjustment and Transmission Recovery Factor fees, DME charges a total of $.1332 per kilowatt hour, plus a monthly charge of $8.80. The winter rate is slightly lower.
CoServ charges $.1223 per kilowatt hour plus a larger fee of $10 a month. For fully renewable energy like DME’s, Green Mountain charges $.179 per kilowatt hour. Further, during Winter Storm Uri, CoServ had outages that lasted days whereas DME’s were one-hour on, one-hour off. A senior staff member of DME lives in Corinth and was out of electricity, ironically, for three days. So if this is price gouging, bring it on.
Further, having a municipal utility helps the city encourage businesses to move here because we can offer deals for their electricity. (See my answer to the question about attracting small businesses.)
Suzi RuMOHR
Denton Municipal Electric is a city-owned utility provider that relies on maximizing the number of customers to keep overall rates lower per person.
Recent rate increases from DME came primarily from the $207 million in debt that was incurred in just four days in 2021 during Winter Storm Uri. Failure of the ERCOT grid was not DME’s fault, but DME still had to pay exorbitant energy prices during those few days to ensure Denton residents had access to energy.
Due to inaction from state leaders, DME must pay the $207 million in debt from Winter Storm Uri. To pay this bill, DME was forced to increase rates for customers. This massive increase would not have occurred if the ERCOT grid had not failed in 2021 and if state leadership had not allowed companies to charge exorbitant prices to entities like DME to provide energy to customers during the storm.
While we cannot change what happened in the past, we can look to the future to ensure efficient use of resources by DME to avoid massive rate hikes. With any future Council decisions related to DME, I would balance my decision-making on efficiency, long-term outcomes, and the environment.
Margie ELLIS
Having a municipally owned electric company does have benefits, like local control over rates, increased community investment through local spending, greater responsiveness to local needs and a stronger focus on reliable service within the community compared to private utilities. But if oversight is not there, and questions are not asked, then there can be a downside like the rate increases we have seen of late.
City council needs to ask more questions of DME. DME has encountered serious financial problems due to relying too much on unstable energy markets and making costly infrastructure investments that did not meet community needs. Poor predictions of energy demand and mismanagement of necessary contracts increased debt, leading to rate hikes that burden residents.
To prevent these issues from happening in the future, better measures need to be implemented to assess the community's energy needs and ensure transparent decision-making that considers current and future demands. We should also consider regular increases in electric rates rather than significant hikes as a reaction to incurred debt.