Electricity Providers in Texas

By Don Munsch

Catherine Crisp said she is tired of getting overcharged by her electric provider.

She’s in good company, as other members of her community in Rhome have protested their rates by Corinth-based Co-Serv, their electric company.

Fifty-eight residents of ByWell Estates near Rhome sent a petition protesting their rates to Co-Serv. The petition was mailed on May 5.

Shane Laws, marketing and communications manager for Co-Serv, said he has received the petition and letter and said his company is doing what it can to keep customers’ costs low. He talked with Crisp about the residents’ complaint.

The residents say the electric company is charging an exorbitant amount for its “Power Cost Recovery Factor.”

Crisp’s bills reflect PCRF charges that average around 37 percent over a 15-month time frame.

“When I spoke to Co-Serv about it, their immediate response was ‘Well, you know, the cost of fuel is going up, and that’s just to help cover our costs,’” she said. “I think that a business should be a little more stable, or doing something different. Fifty percent of your bill? That’s a little outrageous.”

Crisp said the company could survive by charging customers a lot less.

“I just sat down one afternoon and pulled up my one year’s history and it’s progressively increased, every month,” Crisp said. “Long before gas was nearly $3 a gallon, this PCRF was enforced. We understood it – to a point – and never said anything about it. But I think it’s getting out of hand.”

Co-Serv is a non-profit cooperative that serves the subdivision, located north of Texas 114 and east of U.S. 81/287. The company serves 120,000 electric customers and 45,000 gas customers in North Texas, Laws said.

Every resident in the subdivision was willing to sign the petition, Crisp said.

“Even those who said they didn’t think it would do any good signed,” she said.

Crisp, who started the petition, said she didn’t know whether the petition would succeed, but the residents wanted to go on record with their discontent.

“Because if we do nothing or say nothing, I think that’s worse,” she said. “Trying is the best you can do.”

Laws said that he asked Crisp whether he could talk with residents in a neighborhood meeting.

“She said, ‘I don’t think that’s necessary,’ ” he said.

The PCRF is the difference between what the company pays wholesale and its base rate. Laws said the PCRF is four cents per kilowatt hour, and the company does not expect that rate to go higher than that the rest of the year.

“So, for instance, our base rate right now is just over 7.8 cents per kilowatt hour,” Laws said. “That’s in the rate itself. The cost of that wholesale power to us has been around 9 cents per kilowatt hour. What’s not included in that is also what it costs for overhead and operating expenses to keep the lights on – that’s where the four cents is. So obviously we have to recover what we pay for the power and we have to have an additional portion so we can maintain the lines, build new lines, keep the lights on – those kinds of things.”

Other power providers have a fuel adjustment cost that is factored into customers’ bills, Laws said. It’s also a per kilowatt hour charge.

ByWell residents asked for a PCRF rate of no more than 25 percent.

The PCRF rate is about one-third of their bill, Laws said. He said the company can’t fulfill residents’ request to make a fixed rate.

“It’s not in our rate structure to be able to do that,” he said.

The main reason for the PCRF is to factor in or be able to adjust for fuel prices.

“If I fix the PCRF, then I’m going to constantly be raising my rates, so the net effect is the same – I’m going to have to recover my costs,” Laws said. “At Co-Serv, we’re as close to costs as possible – that’s the cooperative model, we’re not here to make a profit. So I have to have some way to adjust for any kind of fluctuations in that base rate, in that wholesale power cost. The PCRF is essentially the only way without having to do a rate change.”

Laws said customers shouldn’t expect their rates to go up this summer compared to what they paid last summer.

Laws said Crisp and other residents wanted Co-Serv to put together some information of what Co-Serv and Brazos Electric, which is the wholesale power supplier, is doing to lower the price of electricity to members. Laws said his company will oblige.

Crisp said she and other residents will await that letter from Co-Serv to decide what they’ll do next. She said residents had not contacted the Public Utility Commission because it wanted to see how Co-Serv responds.

“Co-Serv is investing in technology to try to make us more efficient and do our jobs better to provide reliable, low-cost service,” Laws said. “I talked to Ms. Crisp about the growth in our area. We’re growing at 12 percent a year. Obviously, when you have that kind of growth there’s a lot of infrastructure that has to be put in the ground. And we have been able to fund that for the last two years without borrowing any money.”

Laws said his company is looking out for the members’ best interests.

Crisp said she has lived in the estates for seven years and she said the PCRF charge started a couple of years ago.

“All of us out here are just strapped,” she said. “With all of the things that we have to pay in the way of taxes and things, it’s almost like we’re step-children and they just don’t want the subdivision to survive.”

Residents understand that fuel costs have risen, but they just don’t want their PCRF to be over 25 percent of the bill, she said.

Crisp said she wants Co-Serv to try hard to get its rates down, and she said that the company needs to negotiate with its suppliers to keep costs low, which Laws said his company already is doing.

She wanted to know whether the company is investigating wind energy as a source. Laws said his company is exploring other renewable and alternative sources of energy.