Your Rights as a Customer and the Power to Choose

            Do you know your rights as a customer for your power to choose an electricity plan? Consumers of electricity have special rights regarding their ability to receive and use electricity and it will help protect them from fraudulent transactions and scams. The Your Rights as a Customer (YRAC) document was created by the Public Utility Commission of Texas (PUCT) to address what can and cannot be in the terms and conditions provided by a retail energy provider (REP). The entire document can be found under Texas Administrative Code, Chapter 25, Subchapter R, Subsection 25.475.

            No Grey Areas

            Everything contained within the electricity facts label (EFL), terms and conditions, marketing material, communications, and YRAC must be clearly stated and defined. There cannot be any information which could be misconstrued, fraudulent, or unfair on behalf of the customer. A startup REP cannot claim that they provided service prior to a time when they became a certified REP. REPs also cannot claim that their electricity service will outperform service from any other company. The Electricity Reliability Council of Texas (ERCOT) ensures that all energy transmissions are treated equally, fairly, and reliably.

            Consumer History Cannot Impact Price

            Retail energy providers are not allowed to adjust the rates of your electricity based on your credit or payment history. Regardless of what kind of plan you have, including prepaid, fixed, and variable plans, your rate cannot be changed unless the terms of the plan allow for it based on market conditions. Your payment arrangements cannot affect it, but with prepaid and variable plans, the rate can change based on market conditions. Fixed rate plans won’t change at all, unless there is a change in delivery charges or new regulations cause an increase in prices.

            Written Notice and Information Rules

            Written notice of contract expiration must be presented to the consumer within 30 to 60 days of the expiration for residential customers and within 14 to 60 days for commercial customers. Changes to the terms and conditions of a current plan must be brought to the consumer’s attention at least 14 days before the change occurs.

            In order to search for electricity plans, customers are not required to provide anything more than a zip code. The EFL of every plan will give precise details on how plans operate, and will explain the finer details about the energy rate, how it’s derived, and what can possible change, if at all. You, the consumer, have the power to choose your energy plan, and all the information to make an informed decision is available for every consumer. No REP can legally swindle you into a plan, so knowing your rights as a consumer will ensure you are protected.

The Power to Choose Your Energy Reaches far Beyond Cost

Deregulation in the state of Texas has brought with it a unique opportunity for consumers. Prior to 2002, energy consumers in Texas could only get electricity from one place: their local utility. While it may seem convenient to just have a single place to buy electricity from, it goes against the free market which our country has worked hard to preserve. In a free market, the people have choices and can buy all sorts of products, including energy from different places for competitive prices.

Post deregulation, the markets were opened up to retail energy providers, or REPs, that would purchase shares of electricity from generation facilities, then sell the electricity to consumers, both residential and commercial. The utility still plays a role, but it is to transmit electricity and maintain the transmission lines. No longer do they sell the electricity to consumers directly.

The REPs have populated the state at a quickly and steadily growing rate, seeming to pop up everywhere in recent years. The function of each REP remains constant: buy shares from the generation facility, sell it to consumers in packages or products. The product --- that is, an electricity plan --- can vary quite a bit among REPs, however. REPs may offer just a few plans, or they may offer a dozen. It all depends on the type of electricity they have access to, what their share costs are, and how the market changes.

There are three major components to electricity plans: price, contract length, and energy type. The contract length determines how long the rate stays constant for the consumer. A variable or prepaid plan is a month to month plan with no contract. You can switch at any time from these plans without incurring a penalty, but while continuing it, you are at the whim of the energy market. Any deviation in market conditions will affect your rate, causing it to rise or fall, with no guarantee of how it will affect you before your next bill.

Plans that have a contract last between three months and three years, depending on your provider. When you choose one of these fixed rate plans, your rate will not change, no matter how much the energy market is impacted. If you can lock in a very low rate with a long contract, you’ll be set for a good long while as month to month plans and new contracts continue to rise. The only things that could potentially affect your rate would be new legislation or changes in distribution methods and costs.

When it comes to energy type, all electricity is the same. So how is it different? The difference comes from the source. Renewable energy comes from green sources like wind or solar. Nonrenewable energy comes from sources like coal or natural gas. The electricity works the same coming from each, but renewable energy will be more plentiful and won’t deplete like nonrenewable will. It is also much cleaner and better for the environment. Beyond that, since all electricity is the same, no matter where it’s sourced from or who sells it to you, there’s no reason not to look for a cheaper plan.

The Electricity Reliability Council of Texas (ERCOT) ensures that all energy is treated equally and fairly. Utilities cannot charge you extra because you no longer purchase electricity from them, nor can they affect how reliable your service is. Don’t be fooled by any company who charges a high rate with the promise of more reliable service.