Some Texans will be prevented from exercising choice in the deregulated electricity market under controversial new Public Utility Commission rules that took effect on Wednesday.

Under new PUC rules, ERCOT could be called upon by your retail electric provicer to block all service to your meter.

The new rules have drawn opposition from the Texas Coalition for Affordable Power and other consumer groups. Under the rules, a retail electric provider can hold a Texan with past due electric bills as a captive customer — and without power — until the late bills are paid in full. These so-called “switch blocks” would be enforced by the Electric Reliability Council of Texas, which operates the Texas power grid.

TCAP General Counsel Geoffrey Gay said the new rules violate the principals of the free market by allowing private retail electric providers to use the power of the state — in the form of the Public Utility Commission and ERCOT — to become their bill enforcers.

“We believe that everyone should pay their bills — but the PUC and the operator of the Texas power grid shouldn’t team up to become the collection agency for private companies,” he said. “These new rules violate the principals of the free market and undermine safety. This is very troubling, especially given the high temperatures we can expect during the summer months.”

The new rules would affect only those households with customers who have entered into flexible payment plans and who then get disconnected for non-payment. Under the rules, retail electric providers can call upon ERCOT to block all electric service to that household until the bill is paid in full. As a result, some Texans who would have gone without electricity for a day or two under the old rules likely now will go without power for much longer, said Gay.

Under existing PUC rules, retail electric providers in competitive areas generally are required to offer flexible payment plans for Texans who get behind in their electric bills. However, TCAP and other consumer groups now express concern that because of the new switch-block requirements, the flexible payment plans could become a trap for such customers.

The Texas AARP today also issued a warning about the new rules.  A link to the new rules can be found here, at the PUC website.