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What to expect when retail electric providers consolidate
How the Texas residential electric market is evolving

Posted by Troy Donovan on 02/07/2012 at 5:20 PM

Bobby, a member of the CenterPoint Energy Services team, received an email from his retail electric provider (REP), Kinetic Energy, last month. In it, Kinetic announced that it is now part of Cirro Energy, which is owned by Dominion Resources. The letter assured that his contract terms would remain the same for the remainder of the term. Though it may it be a surprise to customers to receive such a message, this type of activity is becoming more common in the Texas market.
 
Kinetic Energy isn’t the only REP that has been acquired by larger REPs recently:
 
  • Just Energy purchased Houston locals Tara Energy, Amigo Energy and Smart Prepaid Electric.
  • Exelon Corp. will soon combine with Constellation Energy, which has already bought Houston-based StarTex Power and MX Energy.
  • Dominion Resources bought Dallas-based Cirro Energy. Cirro has since merged Simple Power and Houston-based Kinetic Energy under its brand.
  • Direct Energy now owns First Choice Power.
 
Rest assured that the mere change of ownership of your REP shouldn’t require much from you, and that there are customer protections in place that safeguard the Texas electric customer. But if you find that you are transferred from one REP to another because of an acquisition, merger or similar reason, you are entitled to the following:
 
  • A prompt notification from your new REP explaining what will and will not change
    • They may keep the same company name
    • They may continue the same billing methods for a while
  • The new REP is obligated to spell out your new terms of service and honor the disclosures within their Electricity Facts Label (basically, on the details that make up your bill)
  • The new REP may honor your existing plan or they may change it. But if they do materially modify the terms you had with your old REP, you are allowed to choose a new provider
 
It’s also a good idea to check out the other plans and services offered by the new REP. Plan types, services and prices vary, so a review of what else they offer could give you a clue about the kind of offer you might receive when your contract is up for renewal. If you find the change unappealing when your contract is due for renewal, remember that you have the right to choose another company.
 
In Bobby’s case, Cirro Energy said they will honor his existing contract terms and pricing and that they will provide improved customer service and online account services, which works for him.

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