Global InformationDeregulation of the Texas electricity market information
The Texas electricity market is deregulated, meaning that there is competition in the generation and distribution of electricity. Power generators in the Texas Interconnection, managed by the Electric Reliability Council of Texas, participate in an energy-only electricity market and are compensated only for the electricity they produce. The wholesale generation market was deregulated in 1995 and the distribution market in 1999, with Texas Senate Bill 7. This replaced the prior system in which power was generated and consumed locally by the same utility with one in which retail providers contracted with generators across the state.[1]
As a result, 85%[2] of Texas power consumers (those served by a company not owned by a municipality or a utility cooperative) could choose their electricity service from a variety of retail electric providers (REPs), including the incumbent utility. The incumbent utility in the area still owns and maintains the local power lines (and is the company to call in the event of a power outage) and was not subject to deregulation. Customers served by cooperatives or municipal utilities could choose an alternate REP only if the utility has opted in to deregulation; only the Nueces Electric Cooperative has chosen to opt in.
Between taking effect in 2002 and 2006, approximately 85% of commercial and industrial consumers switched power providers at least once.[citation needed] As of 2008, approximately 40% of residential consumers in deregulated areas switched from the former incumbent provider to a competitive REP.[citation needed] REPs providing service in the state include AmeriPower, TriEagle Energy, Acacia Energy, Ambit Energy, Breeze Energy, Bulb Energy, Clearview Energy, Green Mountain Energy, Conservice Energy, Iluminar Energy, Now Power, Snap Energy, Entrust Energy, Bounce Energy, Champion Energy, Shnye Energy, Cirro Energy, Direct Energy, Dynowatt, First Texas Energy Corporation, Frontier Utilities, Gexa Energy, Glacial Energy, Just Energy, Kinetic Energy, Mega Energy, APG&E, Adjacent Energy, Spark Energy, StarTex Power, Stream Energy, Tech Electricity, Texas Power, TXU Energy, XOOM Energy and 4Change Energy.
According to a 2014 report by the Texas Coalition for Affordable Power (TCAP),[3] "deregulation cost Texans about $22 billion from 2002 to 2012. And residents in the deregulated market pay prices that are considerably higher than those who live in parts of the state that are still regulated. For example, TCAP found that the average consumer living in one of the areas that opted out of deregulation, such as Austin and San Antonio, paid $288 less in 2012 than consumers in the deregulated areas." However, the report concluded that re-regulating the market would not solve the issue. TCAP instead offered a series of reforms designed to increase market efficiency.[4]
- ^ Dylan Baddour, Texas' deregulated electricity market, explained, Houston Chronicle (June 8, 2016).
- ^ "Explore Energy Rates in Texas". SaveOnEnergy.com. Retrieved 15 October 2013.
- ^ Dyer, R. A. (2014), Deregulated Electricity in Texas (PDF), Texas Coalition for Affordable Power
- ^ Steffy, Loren (March 2014), The Generation Gap, Texas Monthly