Some companies have stepped up and are offering incentives to switch plans and or companies... May be time to shop around for some consumers

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Whether it was on their own good will, market driven, pressure from Chairman Smitherman, or the repeated efforts of State Representative Sylvester Turner, AARP, Texas One Voice, Texas ROSE, and Texas Legal Services Center to impose additional summer protections for electricity consumers this summer; many companies have stepped up and are offering an array of incentives and new products to keep, attract, and ease the financial burdens of summer electricity bills. What does this mean for you consumers out there? It may be time to shop the market and switch companies or take advantage of better product offerings with your current provider.

I commend those companies who have stepped up, and I will be informing customers whom I come in contact with of such retail electric providers and their summer offerings (as Chairman Smitherman encouraged advocates to do). The following is a abbreviated breakdown as highlighted by the PUC in a press release this week of what these companies are doing. Please contact the specific company to get all the details of their offers…


Ø Reliant, TXU, First Choice Power, Dynowatt, Stream Energy, Gexa, Direct Energy – Deposit waiver for seniors 62 or older (as low as age 60 in some cases). This benefit is especially important for customers who want to switch providers.

Ø TXU, Stream Energy, Reliant – Credits up to $250 for customers who enroll in a new plan. This benefit rewards long-term customers concerned about termination fees.

Ø Dynowatt, Direct Energy, Tara Energy, Reliant, First Choice Power, Stream Energy, Green Mountain, Gexa, Just Energy, TXU, StarTex Power – Additional announcements about LITE-UP Texas, the low income discount program. Customers who are not automatically enrolled in the low-income discount program are eligible if their income does not exceed 125 percent of federal poverty guidelines ($27,563 annually for a family of four). TXU provides its own low-income discount of 10 percent to eligible customers in addition to the LITE-UP Texas discount.


A couple of notes on these offers. I want to highlight a couple of differences between the three companies (TXU, Reliant, & Stream) who have offered all three of the above incentives.

Cheapest Fixed Rate: (per kilowatt hour) *per http://www.powertochoose.org/ 7.30.09

Reliant - 13.5¢
TXU - 13.5¢
*Stream - 11.3¢

This equals a monthly savings with stream of $36.60. What should also be noted is 11.3 ¢ is a mid level price offering and that 13.5¢ is one of the higher price offerings in the market. Before you jump the gun and think I'm endorsing Stream Energy, keep reading!

There are many other factors one must weigh and evaluate before making a decision, that is one of the conundrums of this deregulated market. It is almost impossible to do a side by side comparison and choose the cheapest! Some other factors…

Cancellation Fees:

Reliant - $150
*TXU - $100
Stream - $150

Customer Complaint Score: (1 being least complaints - 5 being most complaints)

*Reliant - 1
TXU - 2
Stream - 3

As you can see, each company is the best in one of the three categories. To add another twist TXU & Reliant have introduced voluntary moratoriums on summer disconnects if you honor an agreed to payment plan (an additional protection which adds value to their product). It is hard to choose what is best. Everyone has different individual needs. That is why the market may be good in some instances, different products for different people. My point, customers should shop around right now and try to take advantage of some of these product offerings.

Another VERY IMPORTANT thing to point out and make customers aware of, was a reiteration today at the PUC by Chairman Smitherman with concurrence from his two colleagues that they believe they have the authority to enforce or take action against any company who offers a voluntary program and does not completely HONOR it. If you or anyone you know thinks a company is not honoring any of these programs or has improperly denied access to any of these programs please contact the PUC and register a complaint!

BEWARE: As I alluded to in one of my first posts, a cheap rate does necessarily equate to a cheaper overall contract with a company. Look into the details and the customer satisfaction levels and additional customer protections a company offers. It will be well worth you time in the long run.

My name…. is…. Raoul Duke, ..I must have a suite!

Actually that’s not my name, you gonzo journalist out there will understand! It is just my lame attempt to put some humor into what can be a very boring and complex subject matter, electricity! My name is Cory Henrickson and yes I work for the government and I’m here to help! More specifically I work for State Representative Sylvester Turner of Houston.

This post is for a couple reasons, one I said I would say who I was; I’m not here to anonymous blog or keep secrets. Two, I have already posted my personal e-mail address on a post. Lastly, I post this in response to a comment on my last post in which commenter The Druid asked this, “Which brings me to my next point, are you speaking on behalf of Mr Turner, or yourself?”

I speak for no one but myself. When I’m at the capitol and Rep. Turner wants me to speak for him I will. That is my job, this is my personal blog. Though they may overlap, this blog is 100% my own efforts, ideas, and ramblings. I thank you for asking the question, I do believe it is important and I should have posted this sooner.

I will attempt to keep the blog as un-political as possible! However, I have my biases, as do we all. So, when I rant against a state agency for not enforcing their rules I guess this could be viewed as political. However my point is (was) to be consumer friendly and an advocate for responsible business and state regulation. My intent for this blog is to help consumers with strategies and information. The key to a properly functioning market is unfettered information.

To The Druid, I’m going to Copy, Paste your comment and my response to your comment on the last blog just so we are all clear on what was said.

The Druid said...

Wow, your 6 months experience as a legislative staffer is sure showing through. If you knew any better you'd know that the PUC is the only agency required by statute to enforce the substantive rules, not the Office of Public Utility Counsel. Where were your friends at Texas Legal Services Center to tell you of these awful violations? Aren't they charged with advocating for consumers? The trial lawyers sure line their pockets enough for them to go out and be crusaders, like yourself. Which brings me to my next point, are you speaking on behalf of Mr Turner, or yourself?

JULY 29, 2009 11:52 AM

phunkster2001 said...

First and foremost I speak on behalf of myself and no one else, and I will make a post to make that very clear.

Secondly, If you read my post, in no way do I imply that OPUC has authority to enforce rules. I have a clear understanding of who is charged with what and who has what authority, your comment is misleading and just plain wrong. The exact statement in the post says, " the PUC should have discovered this before me! If not them, where was the Office of Public Utility Counsel, you know the independent agency charged with advocating for consumers!?"

OPUC and the PUC are perfectly capable of discovering rules violations. OPUC can find abuses which affect consumers, such as what the post highlights, and advocate for the PUC to enforce the rules. This is what they should be doing in instances such as this clear violation of the rules.

As far as your comment on Texas Legal Services Center goes I'm not sure that it warrants a comment however I will simply say this. They work very hard at protecting consumers and offer legal services for many things, not just electricity issues. As with most advocate organizations, funding and staff are always an issue. They do a very good job at what they do with what they have and I commend their efforts.

Lastly, I thank you for taking the time to read the blog, and I appreciate feed back. However, I would request that it be accurate if you are attacking my position or my understanding of an issue.

Cheers

Champion Energy’s outside Counsel agrees with me and says they will change their Terms of Service regarding level/average billing plans…

In what is the first of hopefully many more victories to come, Champion Energy is changing their terms of service in response to an e-mail exchange I had with a representative of the company. As pointed out in the previous post Tip of the Day…, it appeared to me, Champion Energy was requiring more than PUC rule allowed when determining customer eligibility for level or average billing options. After notifying and questioning the company, I have been informed that they have spoken with outside counsel and will be changing the Terms of Service for thier product offering. Shouldn’t the PUC have caught this!? Do they not look over a REP’s Terms of Service Contracts before giving certification to a company or a product offering!?

So, upon this discovery I examined the terms of Service for 29 Companies in the 77091 (Houston) zipcode. I found numerous Retail Electric Providers, in what I believe to be in violation of the same rule. Many companies appear to have additional requirements above and beyond a customer’s current account status, which is all PUC rule allows for. I have requested the PUC to look into this and have given them a breakdown of which companies I believe to be in violation.

This has inspired me to go on a rules crusade and continue giving people insight and pointing out rules that customers can take advantage of. The rules are often times hidden and many times companies either don’t want you to know about them (numerous companies have no mention of average or level billing in their terms of service), or flat out violate in what appears to be PUC approval in hopes that they will not be discovered. I’m a legislative staffer with 6 months experience in the electricity realm; the PUC should have discovered this before me! If not them, where was the Office of Public Utility Counsel, you know the independent agency charged with advocating for consumers!?

At this point I will repeat my message of why level or average billing is important and the reason for the last two blog posts. This billing option can prove to be a valuable tool or billing option to help consumers offset high summer electric bills. Consumers should be made aware of this option and should be able to take advantage of it without companies setting up road blocks and breaking PUC rules!

Tip of the day…. A Way for Consumers to Ease High Summer Electricity Bills

PUC Substantive Electricity Rule 25.480 (h); Level and average payment plans. This rule states, "A REP shall offer a level or average payment plan to its customers who are not currently delinquent in payment to the REP." What does this mean?

Well, our office has been inundated with phone calls of citizens struggling with their higher than normal utility bills because of the sweltering Texas summer. High temperatures result in increased electricity usage and therefore higher bills in the summer months. We all know this and it occurs every summer, but what many of us don't know is about this rule which may allow consumer to avoid such financial crippling situations, especially those on FIXED INCOMES. So, I would like to take this blog opportunity to highlight the rule and inform consumers of this option.

The rule mandates that a retail electric provider must offer a customer an average or level billing plan if a customer so desires. The ONLY qualification one must meet is that they are current on their bills. If a company indicates otherwise, or is unwilling to meet the request of the customer the customer should IMMEDIATELY inform the utility company of their rights under the PUC Substantive Electricity Rule 25.480 (h) and ask again, if the company still refuses they should IMMEDIATELY contact the the PUC and lodge a complaint. It may be useful to also contact your State Representative and inform them as well.

A WARNING about this option is that the Utility has the right to (and they will) occasionally square up the bill. What this means is that anything used and not billed for will be billed and any over billing will be credited to the account. One negative impact of this could be, a bill which is higher than the others. What this also might mean is, if the company significantly miscalculates your average consumption, you could end up with a significantly large bill to square up the account. I assume they can get it pretty close, but you never know so beware!

Also many companies DO NOT INFORM you of this option or it is hidden in the terms of service agreement. Therefore you must ask them for it. And again, the only requirement is that you can not currently be delinquent! If the company implies otherwise, they are breaking the rules, so REPORT them!

One company, Champion Energy Services has this in their terms of service agreement…

35. Budget Billing Plan: Champion may offer a budget billing
plan for Buyers who are currently not delinquent and who have
not had more than two (2) delinquencies in the past twelve (12)
months. Variable payment amount is based upon prior usage
and may be adjusted for significant differences between actual
and billed usage.

This appears to me to be against PUC rules, because of the additional requirement (2), stating you must not have been delinquent in the past twelve months. While, I don't know what would happen if a customer of Champion Energy Services were to request a average bill plan and point out their rights under PUC Rules, I'm currently looking into this and similar situations with other companies.

Good luck consumers!

Hot off the Press

Here is a story from KHOU Channel 11 based out of Houston Texas regarding disconnects this summer... http://www.khou.com/topstories/stories/khou090721_tnt_electricity-service-disconnect.61b89514.html

Lower Rates does not necessarily suggest you should switch companies…

As pointed out in a comment by Whitney in my Welcome post, a lower rate does not imply that a customer will be better off. She suggested in her comment I include the Retail Electric Providers Scorecards as a new link, which I have now placed on the helpful links section of the blog at her suggestion. (http://www.powertochoose.org/_content/_complaint/index.aspx)
Thank you Whitney for your suggestion and hard work on electricity issues.

A couple short comments on this issue of lower rates and consumers being better off just because a rate is lower. As Whitney suggest, " It seems like there is a correlation between low electric rates and high complaint rates." This does not seem to be a far fetched assumption, therefore I plan on doing some more research into this and I will share my results as soon as I have them. I'm no statistician, however I think I can figure some rudimentary evaluation of this assumption. My point is, to ANY CONSUMER THINKING ABOUT SWITCHING COMPANIES!? Please be informed, look at these compliant reports, the Terms of Service Agreements & the Energy Facts Label (EFL ) before switching companies. A lower rate can lead you to a company with hidden fines, surcharges and a poor track record of company dealings with their customers. This in turn can lead to a higher total electric bill, even though your per kilowatt rates are lower.

For example on the surcharges, check this one out I found today in the Terms of Service Agreement and on the EFL for Ambit Energy, "Customers that use less than 1,000 kwh of electricity in any given billing period will be assessed a customer charge of $4.99 for the Heart of Texas plans, $9.99 for the Lone Star plans, and $9.99 for the Ambit Certified Green plans." I'm not claiming these charges are hidden, I'm just stating the consumers must read theses EFLs and Terms of Services agreements to get the full picture. The irony, conservation is being assessed a surcharged under this rate plan. How can we reconcile this with the conservation alert/request of the PUC last week. The $9.99 charge equates to roughly a 9.5% consumption surcharge at 10.6 cents per kilowatt hour based on 1000 kilowatt monthly consumption.
I don't imply that Ambit Energy is the only company with such a surcharge and I will do my best to alert everyone of the others companies and surcharges I discover. This market is a labyrinth and I will disclose my discoveries as I make them. Thank you for your time.

And please remember "The devil is in the DETAILS", read the fine print.

Welcome...

My first post will be to simply point out the links on the side of the blog. I will be adding links as I progress on this project. My goal will be, to not overpopulate the links section and only put what I believe to be IMPORTANT information, forms, stories ect. That being said as of today I have links to the LITE-UP Texas program which helps provide discounts to low income customers. Though the program is limited to summer months, I encourage anyone who thinks they may qualify to apply at any time (see federal poverty level guidelines @ the following link). http://www.coverageforall.org/pdf/FHCE_FedPovertyLevel.pdf

There is also a link to the critical care customer form; those customers for whom a loss of electricity service could cause medical issues should file this form with their Retail Electric Provider. The powertochoose website is also linked, this is a webpage where a customer can simply go in and type their zipcode and compare offers in their service area.

The other link will hopefully be viewed as a helpful tool to some consumers. It is a basic calculator that will allow someone to plug in values, such as cancelation fees deposits and new rates, and then compare their estimated year total bill with what they would pay if they stay with their current provider.

The impetus for this calculator is the numerous calls by the Chairman of the Public Utilities Commission (PUC ) Barry Smitherman for customers to take advantage of the market and shop for lower rates. Chairman Smitherman has repeatedly encouraged customers to do this while denying Representative Sylvester Turner’s Emergency Petition on Summer Disconnection Protection this summer. One of the reasons for the denial was the Chairman’s repeated reference to what he says are lower price offers in the market. So please plug in and see if it works for you! I must make clear that I do not believe this option of switching is a fix to the problem Representative Turner and co-petitioners seek to remedy. Most of the customers the petition they filed seek to help cannot absorb the cancelation and new deposit costs because they are on fixed incomes. A point Rep. Turner has tried to make to the Commission, which has seemed to fall on deaf ears.

On a side note, when he says lower we should ask lower to what. His reference point has been 2006 prices when the PUC last ordered a disconnect moratorium. However, Texas residential rates continue to be higher than neighboring states (40%- 60 %), and higher than pre-deregulation. As pointed out by this truth bearing statement by Loren Steffy of the Houston Chronicle, “the deregulated market continues to defy the basic rule of capitalism. Competitive rates remain more expensive than non-competitive ones.”

Well, I hope this is the beginning of a insightful and useful conversation regarding the evolution of the electricity market in Texas and I look forward to hearing from my readers. Oh ya, I will explain who I am on the next post, for now I must go forward with my evening. This is not how I envsioned my friday night when I left work today!