Who's Who of Deregulation
Here is an overview of the different entities in a deregulated market.
PUCT: The Public Utilities Commission of Texas regulates and implements legislation of the state's utilities, including electricity, and has ultimate oversight of the competitive market. The PUCT has oversight and enforcement authority over ERCOT.
ERCOT: The Electricity Reliability Council of Texas is the Independent System Operator (ISO) that manages the flow of electricity across approximately 90% of Texas. ERCOT’s primary responsibility is ensuring reliability of the electric grid by continuously balancing the supply of generation resources with the demand of homes and businesses.
LP&L: Lubbock Power & Light will act solely as the utility that owns and operates the physical electricity distribution system. After the transition to a competitive market LP&L will no longer sell and invoice electricity to homes and businesses. LP&L will continue to serve as the primary point of contact for power outages.
REP: Retail Electric Providers are also referred to as competitive retail electric suppliers. These companies will enter into contracts to sell electricity to homes and businesses and invoice them in place of LP&L. These include NRG, TXU, Shell, Gexa, Constellation and many others.
Default Provider: After competition is implemented LP&L will no longer be an electricity provider to any customers. Therefore, any home or business who has not chosen a Retail Electric Provider will be automatically assigned to a Default Provider. REPs will submit their interest to become a Default Provider via an RFP process and will be chosen by LP&L and the City Council. Customers will be able to transition from their Default Provider to a new REP.
POLR: REPs will volunteer or be assigned to serve as a Provider of Last Resort. If a REP goes out of business or leaves the ERCOT market, their customers are transitioned to a POLR supplier. This backstop function ensures the customer’s electric service is transferred to a new REP without interruption of service. Customers can transition from their POLR to a new REP.
ABCs: Advisors, Aggregators, Brokers, Consultants serve as intermediaries between home or business customers and REPs. ABCs work for customers to help them navigate the competitive retail electric market. ABCs are required to register with the PUCT but are not regulated by the PUCT or ERCOT. Companies of all sizes and types operate as ABCs, and have varying degrees of experience, expertise and service capabilities.
5 is actively advising clients in the LP&L territory as they prepare for the procurement and operational opportunities ahead. Please reach out to your energy advisor from 5 or contact us to learn more about what clients are doing in that area as they transition to a competitive retail electricity market.
