Why don't Texans deserve energy price transparency?
They do. Here's why:
Texas energy consumers deserve transparency regarding their energy bills; a rather simple and direct ask of energy suppliers in the state. However, there are large discrepancies between notification requirements when it comes to variable versus fixed-rate energy products. Often, consumers are presented with variable rates that can be twice as much as fixed rates. Due to new regulations enacted as a result of HB16 residential consumers are required to be notified of any change to their fixed rate plans. However, the legislation falls short in protecting the most vulnerable consumers — those who choose variable, short-term rates and those already on a variable rate — by not requiring notification of rate change for variable rates. As a steadfast, customer-focused energy provider, we’re asking the Public Utilities Commission of Texas to clarify HB16 legislation that would require that any person on a variable rate be notified ahead of time of a change so they can make more informed decisions.
Why are we doing this? First, it’s an incredibly low cost lift for energy suppliers that provides an extremely high value to customers. It’s consumer protection at its core: providing the consumer with necessary information so that they can make informed decisions about their energy. Unfortunately, many suppliers have crafted entire business models around the idea that customers will forget that they are on variable rate products and take gross advantage by not notifying customers when the rate changes. This allows energy providers to hike up energy rates, and they are counting on customers to not notice. It’s how they make the most money and secure their bottom line without providing any real additional value. As a result, energy consumers are potentially overpaying significant amounts for their energy just because of lack of transparency.
What exactly are we asking for in terms of notification? We believe that legislation should mandate notification via email several days in advance of a rate change on a variable energy product. If you’re on a monthly variable rate, this means you’d receive a notification every month before your rate changes, allowing you the opportunity to change energy providers or products as needed. Other services, like streaming services, provide this information to their customers well before a rate change. Take streaming services (e.g. Netflix, Hulu, Disney+, etc.) for example. When these streaming services increase their prices, they let you know ahead of time with an email. Then you have the choice to either continue that service or cancel. But most importantly, you’re informed and have all the information with which to make a decision. Moreover, consumers are notified consistently, regardless of how long they’ve been a subscriber. The same should be the case for energy customers. Simple transparency from energy providers should be the norm, even for those who have been on legacy variable rates.
In a recent survey we conducted across Texas, 84 percent of respondents said it’s important for their electricity supplier to provide regular, transparent updates about any rate changes. Almost one-third of respondents said they would even switch providers if they knew they’d be joining a service that properly notifies them of any rate changes. Variable-rate energy products represent larger segments of the market share within energy; precisely why customers should receive information about them in real time. Such legislation would encourage more innovation within the energy market as energy providers are pushed to think more creatively about what products they offer their customers. No one should be overpaying for energy, especially as a result of sneaky price hikes that they didn’t know about. Transparency in energy pricing is necessary and simply the right thing to do.