Texas Retail Provider Requests PUC End Disconnection For Non-Pay Moratorium Adopted After Winter Storm -- EnergyChoiceMatters.com

Texas Retail Provider Requests PUC End Disconnection For Non-Pay Moratorium Adopted After Winter Storm

Says Retail Market Cannot Survive "Untenable" Conditions Created By DNP Order, As Moratorium Nears Third Month

May 13, 2021

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In a letter to the Public Utility Commission of Texas, Brandon Young, CEO of Young Energy, requested that the PUC end the moratorium on disconnections for non-pay which was adopted in the aftermath of the February winter weather event, arguing that the viability of the retail market is threatened by the ongoing moratorium

"Texas Retail Electric Providers ('REPs') need your help to survive and continue to provide a vibrant competitive marketplace to benefit Texas consumers. Specifically, at your Open Meeting of May 21, 2021, the Commission must act and rescind the February 21, 2021 disconnection for non‐payment ('DNP') moratorium," Young said in a letter to the PUC

"REPs have already made three formal requests to the Commission for emergency action and relief from the DNP moratorium which effectively requires REPs to purchase power to serve customers who do not pay their electric bills. The competitive industry cannot last long if this untenable situation continues," Young wrote

"We joined a group of REPs in a Third Request for Emergency Action with the hope that the new Commission would act at its May 6 Open Meeting to return our industry to a semblance of normalcy. In that Third Request, REPs pointed out that the moratorium on disconnection was created by an exception to 16 TAC §25.483(c) which relates to disconnection of a customer for nonpayment. The Commission’s procedural rule §22.5 grants the Commission the right to suspend the operation of one or more of the sections of this chapter 'if there exists a public emergency or imperative public necessity and the Commission ascertains that suspension will best serve the public interest and will not prejudice the rights of any party.' The public emergency ended weeks ago, and the rights of Payless Power and all other REPs continue to be prejudiced. The Commission must act now," Young wrote

"Payless Power is headquartered in Fort Worth where 85 people are employed. We specifically serve 35,000 customers under prepaid plans per Commission rule 25.498. Our prepaid plans have been popular with consumers who may be credit‐challenged or simply like the certainty and convenience of prepaid electric service. Prepaid service is a unique feature of the Texas competitive electricity market; it provides consumers with an alternative to paying a very high deposit. While traditional service providers require deposits equal to an amount up to 60 days of summertime usage, prepaid providers are not allowed to collect deposits. Instead, Commission rules limit the upfront payment to start prepaid service to no more than $75 down, which in most cases covers about 15 days of service. Therefore, prepaid providers are much more exposed to a suspension of disconnections as they only have up to 15 days on hand to 'weather-the-storm' during a moratorium," Young wrote

"Young Energy has made prepaid service its business, and it is our only business since 2008. We provide exceptional prepaid service. Most retail energy insiders will tell you how hard it is to be successful in the prepaid space; it takes highly advanced systems, sophisticated business rules, highly trained customer care representatives, and carefully engineered products. We strive every day to provide the consumer with flexible payment terms, unique messaging coordinated in text, email, voice and paper mail mediums, and honest straight-forward non-gimmicky electric service. Yet lack of Commission attention to the current disconnection moratorium threatens our business," Young wrote

"REPs have experienced moratoriums on DNPs due to emergency conditions before. These previous moratoriums have lasted a few days -- but we have never before had to continue to provide power to non-paying customers for eleven weeks and counting. The present situation is untenable and probably unlawful. The normal rules have been interrupted by a suspension that has lasted almost three months without any response from regulators and no direction as to how much longer lawfully enacted rules will be ignored," Young wrote

"We were sadly disappointed when there was not even a discussion of this issue at the May 6 Open Meeting. Hopefully, this was an oversight and not indifference to the Commission-created situation which threatens the viability of our business, as well as threatening the financial health of many other REPs in the marketplace," Young wrote

"Please consider and grant the Coalition of Competitive Retail Electric Providers’ Third Request for Emergency Action on or before your May 21 Open Meeting so that further damage to the competitive marketplace can be avoided," Young wrote

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