The state of Texas scored an “excellent” in an independent assessment of restructured electric markets — proving to be one of the most successful states in providing the benefits of retail choice to customers. The report, issued by the Energy Retailer Research Consortium this month, highlights how Texas has made outstanding progress by adopting rules to encourage numerous power producers and retailers to compete for customers and provide a variety of electricity services.  In addition, a recent op-ed in the Arizona Republic by Andrew Kleit, a professor of energy and environmental economics at Pennsylvania State University, further underscored the “remarkable” results in Texas.

However, a Fort Worth Star-Telegram article this week downplays this significant progress and instead focuses on a simplistic comparison of electricity costs in Texas versus neighboring states.  This narrow view undervalues the significant economic and environmental benefits the Texas market is providing the state’s consumers. 

Competitive generation firms have flocked to the state in the years since Texas opened its market and freed consumers from the old regulated monopoly system.

Consumers in Texas enjoy a wide array of competitive choices matched by no other state in the nation.  Sixty retailers are offering a variety of electric rate programs to large business customers and 30 retailers offer service to the residential market.  Texans in competitive areas have exercised choice in record numbers.

Texas consumers can choose among these energy suppliers, many of which offer plans with rates lower than neighboring states — a fact The Fort Worth Star-Telegram got right.  These competitive options are also at rates below the national average price of electricity. For example, the paper reports that on Friday there were 14 competitive electric plans offered at 8 to 8.9 cents per kilowatt-hour which stack up extremely well – not just with neighboring states but across the nation as well. 

While pointing out that Texas’ competitive areas have seen tremendous growth in generation and transmission capacity to meet growing local demand for power, the article overlooks the fact that this private investment — and the financial risks associated with it — are borne by investors, not rate payers as is the case in neighboring states.  In addition, Texas’ restructured electric market is very attractive to green energy investment.  Thanks to the competitive market, Texas is now the nation’s leading producer of wind power.

Consumers in competitive areas can visit the Texas Electric Choice Education Program, sponsored by the Public Utility Commission of Texas, to learn how they can take advantage of competition.

If anything, we hope to see competition expand to cover the entire state so that all Texans can “shop, switch and save,” as the Texas PUC emphasizes.