New PUC Rule Provides Extended Payment Options to More Customers

AUSTIN, Texas--(BUSINESS WIRE)--Catherine J. Webking issued the following statement today on behalf of 17 retail electric providers, known as the Retail Electric Provider Group (REP Group):

“Unfortunately, some customers in the competitive Texas market exploit a loophole that allows them to switch to another electricity provider even though they haven’t paid what they already owe. They’re gaming the system at the expense of the vast majority of customers who pay in full and on time.”

“The Public Utility Commission is considering new rules that significantly expand protections for electricity customers who need help paying for electricity during the hot Texas summers and extremely cold winters when bills can be very high. The REP Group supports the Commission’s goal to protect these at-risk customers.

“Under the new rule, more customers will be eligible for Critical Care status or for a new category called Chronic Condition. Retail Electric Providers (REPs) will be required to offer extended payment plans to these customers as well as to low-income customers and any customer who has not been disconnected in the past 12 months. To help ensure that customers who accept the extended payment plans pay their bill, the Commission included a requirement that customers cannot switch to another electric provider unless their bill is paid in full.

“Balancing the need to help customers with the need to ensure companies are paid for the electricity service they provide is a thorny issue not easily resolved. Over a decade ago, Chairman Pat Wood identified it as an issue the Commission needed to tackle. The current Commission held numerous public meetings and received input from all interested parties.

“If you use a product or service provided by a company, it’s only right that you pay for it. If you don’t, then the cost for everyone else that does pay goes up. That’s true whether you’re talking about groceries, cable TV, gasoline or electricity.

“It’s really simple. In exchange for what amounts to a no interest loan, the new rule simply says you must pay what you owe before you can go… to another service provider. In doing so, it will help electric companies manage their overall cost of service for all customers while still providing important protections for at-risk customers. Most important of all, the new rules maintain the fundamental concept of customer choice in our competitive market. Under the new rule, the customer chooses whether to enter a payment plan and chooses the type of payment plan.

“Unfortunately, some customers in the competitive Texas market exploit a loophole that allows them to switch to another electricity provider even though they haven’t paid what they already owe. They’re gaming the system at the expense of the vast majority of customers who pay in full and on time.

“In our opinion, the new rules don’t go far enough. It only eliminates the loophole for those who enter into longer-term payment plans. However, this is step forward and a reasonable compromise that tries to balance the concerns we have to better manage our costs to the benefit of most of our paying customers while still preserving a customers right to choose.”

The REP Group is composed of the Alliance for Retail Markets (ARM), which includes Direct Energy, First Choice Power, Green Mountain Energy Company, Gexa Energy and Stream Energy; Texas Energy Association for Marketers (TEAM), which includes Accent Energy, Amigo Energy, Bounce Energy, Cirro Energy, Green Mountain Energy Company, Hudson Energy Services, Just Energy, StarTex Power, Stream Energy, Tara Energy, and TriEagle Energy; CPL Retail Energy LP; TXU Energy; and WTU Retail Energy. Catherine J. Webking serves as General Counsel for TEAM.