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Why Do We Have the Power to Choose?

June 22, 2016
by dmirza

Over a decade and a half ago, Texas electricity was ruled by the utility company. They set the prices however they wanted, dictated what your electricity plan included, and if you didn’t like it, well, you could sit in the dark. There were no other options for reliable electricity. Then Texas got a great idea: what if people had the power to choose their electricity provider?

That was the big idea that sparked a major shift in how electricity was provided to customers throughout the state. In 1999, the Texas Legislature decided it would be better to allow consumers to pick their own provider and energy plan rather than allowing the utility to monopolize the entire energy grid.Why Do We Have the Power to Choose
This shift eventually took hold on January 1, 2002, just three years after it was introduced. The legislation banned the utility from setting the price for purchasing electricity and it established ERCOT, the Electricity Reliability Council of Texas, which is overseen by the Public Utility Commission of Texas (PUCT) and which manages the entire grid in Texas, making sure power goes where it’s needed.

The utility wasn’t cut out of the picture entirely, however. Instead of buying electricity from generation facilities and selling it to customers, the utility now maintains the power lines and transmits electricity to the customers. They still play a vital role in the energy market, but they can’t hold their power over the customers in terms of costs.

Consumers now have the power to choose any provider they want that offers electricity in their area. All that is required to search for a plan is a zip code, and sometimes a confirmation of whether it’s a residential or business address. Dozens of retail electricity providers (REPs) compete over 85% of the state trying to get customers’ business.

All the electricity, regardless of the REP, is reliably maintained by ERCOT, so even if you go with a startup company rather than a big name company, your electricity reliability will remain the same. Some sites, like Shop Texas Electricity allow you to search and compare several REPs all at once, so you can easily see who’s got the best deal in town.

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