This Reuters story from Texas (6/5/2013) illustrates some of the perils of electric deregulation. According to a recent TargetPoint survey of Michigan residents, nearly 80 percent of respondents oppose additional deregulation of Michigan's electric industry.
Reuters: Texas power retailers face tight supply, higher $5,000 price cap
(Click here to read the full story)
Companies that sell electricity to homes and businesses in Texas face paying 66 percent more for wholesale power during times of extreme heat this summer if supplies are thin after regulators raised the wholesale price cap to $5,000 per megawatt-hour.
Price volatility in 2008 forced three small retailers to default and a fourth to declare bankruptcy, forcing the grid operator to transfer more than 35,000 customers to new suppliers.
The tight summer outlook raises the prospect for frequent calls for residents to reduce energy use during hot afternoons and for possible rolling outages, the grid agency said. "The bottom line is we do believe there is a potential for emergency alerts this coming summer based on our view of the weather forecast," ERCOT President Trip Doggett told the ERCOT board last month.