Texas Deregulation History

TEXAS ELECTRIC CHOICE
On January 1, 2002, most regions throughout the state of Texas were deregulated allowing both businesses and homeowners to compare electric service and price offerings from Retail Electric Providers ("REPs"). A map of the Electricity Reliability Council of Texas (ERCOT) region can be viewed here (link to map of ERCOT). Co-operative Utilities and Municipal Utilities have the opportunity to opt-in and participate in deregulation, but are not required to participate. Consumers of electricity now have the ability to choose their supplier of electricity while the delivery of the power, or transmission and distribution (poles and wires), remain the responsibility of the "regulated" power company. Consumers have the capability to choose an electricity supplier that best fits their needs based upon price (terms & structures), financial stability, contract terms and conditions, and available service and billing options. Along with customer choice comes the necessity to understand, review, manage and facilitate the electric supply bid process as well as assess current market conditions.

REGULATED SERVICES
The delivery of electricity across poles and wires is called Transmission and Distribution (TDSP). These services are currently provided to you by your local wires company, which is responsible for maintaining the poles and wires, and responding to emergencies and power outages. The Public Utility Commission continues to regulate transmission and distribution service to ensure the safety and reliability of your electric service regardless of which Retail Electric Provider you choose. You do not have the ability to choose your local wires company.

Before deregulation, your electric service was provided by a single electric utility; Texas Utilities (TXU), Reliant Energy, Central Power & Light (CP&L), Texas-New Mexico Power Company (TNMP), or West Texas Utilities (WTU). Your provider was determined solely upon location of the business or residence. To receive electric service, you simply called the local utility company that had the exclusive right to provide service in your area and paid the scheduled rate tariff set by the Public Utility Commission (PUCT) (http://www.puc.state.tx.us). No contract terms and conditions were required.

DEREGULATED SERVICES
With electric competition, Retail Electric Providers (REPs) sell electricity generation to you and provide functions such as customer service, pricing structures, and billing options. These companies purchase electricity from competing power plants, and electricity is delivered to your home or business over the poles and wires of your local wires company. Retail Electric Providers compete for your business by offering lower prices, renewable energy options, added customer service benefits or other incentives. With electricity deregulation, you now have the ability to choose the Retail Electric Provider that best fits your needs. If you do not choose a Retail Electric Provider, your electric service will be provided by your Affiliate REP – a company affiliated with your local wires company at the "price to beat" rate.
No matter which Retail Electric Provider provides your service, the Public Utility Commission continues to enforce customer protections and regulate the delivery of electricity to ensure it is delivered safely and reliably by the local wires company.