Electricity brokers will likely face regulatory oversight like other power dealers

Houston Chronicle

L.M. Sixel March 28, 2019 Updated: March 28, 2019 8:21 a.m.

The Public Utility Commission asked the Texas Legislature earlier this year to expand the agency's oversight to include electricity brokers, companies that represent consumers and businesses shopping for power plans. Brokers, including on-line websites that sell residential power plans, are compensated by power companies for generating business but are not currently subject to consumer protection rules.

A bill filed by Democrat Sen. Judith Zaffirini of Laredo to require brokers to register with the commission and comply with consumer protection rules cleared the Business and Commerce Committee this week and was recommended for the local and uncontested calendar, the place where local issues and non-controversial bills are typically approved, according to legislative records.  A companion bill was filed by Republican Rep. Tan Parker of Flower Mound in the Texas House.

As it currently stands, if an unregistered broker violates the commission's customer protection rules, businesses and consumers have no recourse, according to an analysis of the bill on the state legislative site. That would include complaints of misleading consumers, misrepresenting pricing and operating websites deceptively similar to reputable websites.

The Houston-based Energy Professionals Association which represents electricity brokers in 14 states with competitive electricity markets is in favor of the bill, said director Shannon McGriff.

So is Houston-based Choice Energy Management which negotiates electricity contracts on behalf of business clients.

"Currently anyone can claim to be a broker of electricity, with no education on the matter, no control mechanism or ethics oversight," said managing partner Kiki Dikmen. It essentially opens the door for criminals to be a part of this fraternity, he added, and as a result, the entire community gets a bad reputation.

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