GLOSSARY OF TERMS
The terms listed below are provided for customer information purposes and have been restated in part from the Texas Electric Choice Resource Center (see powertochoose.org) of the Public Utility Commission of Texas.
AFFILIATED RETAIL ELECTRIC PROVIDER (AREP)
The Affiliate Retail Electric Provider was part of the original electric company that generated and sold electricity in your area. Now, the Affiliate Retail Electric Provider only sells electricity and provides customer service.
An entity registered with the Public Utility Commission that brings together a group of customers to buy electricity in bulk.
AVERAGE PAYMENT PLAN
An agreement worked out between a Retail Electric Provider (REP) and a customer that allows you to pay approximately the same amount for your electric service each month. All Retail Electric Providers are required by the Public Utility Commission of Texas to offer average payment plans.
COMPETITIVE RETAIL ELECTRIC PROVIDER
A Retail Electric Provider (REP) that is certified by the Public Utility Commission and competes for your business by offering lower prices, renewable energy options, added customer service benefits or other incentives.
Adding charges to a bill without a customer’s approval. This practice is illegal and penalties are enforced by the Public Utility Commission of Texas.
Removal or relaxation of regulations or controls governing a business or service operation like utilities.
ELECTRIC RELIABILITY COUNCIL OF TEXAS (ERCOT)
The corporation that administers and maintains the reliability of the state’s electrical power grid. When you choose a new Retail Electric Provider, this group will send you a postcard confirming your switch from one REP to another.
ELECTRICITY FACTS LABEL
An information sheet required by the PUC that provides customers with standardized information on a Retail Electric Provider’s prices, contracts, sources of power generation and emissions. It allows customers to make an “apples-to-apples” comparison of Retail Electric Provider offers.
An Affiliate Retail Electric Provider is allowed to recover its costs for the fuel used to general electricity, such as coal, natural gas, wind, water, nuclear, etc., through the fuel factor. This cost is set by the PUC of Texas and charged on each customer’s bill, based on kilowatt-hour (kWh) usage. An AREP is prohibited from making a profit on fuel costs.
Kilowatt, the standard unit for measuring electricity demand, equal to 1,000 watts
Kilowatt-hour, the standard unit for measuring electricity energy consumption, equal to 1,000 watt-hours. The amount of electricity you use each billing period is expressed in terms of a kilowatt-hour, and is noted on your bill.
LOCAL WIRES COMPANY
The company that transmits and delivers electricity to a customer’s home or business along the poles and wires (formerly a local electric utility). This company is still responsible for maintenance and repair of these poles and wires.
MUNICIPALLY OWNED UTILITY
A non-profit utility that is owned and operated by the municipality it serves. In Texas, municipally owned utilities may opt into the competitive retail electric marketplace.
PROVIDER OF LAST RESORT (POLR)
The Provider of Last Resort serves as the “back-up” provider when a REP leaves the market for any reason. If this happens, customers may switch back to the AREP or choose another competitive REP offering electric service in their area.
PUBLIC UTILITY COMMISSION OF TEXAS (PUCT)
The state agency that is responsible for the regulation and oversight of electric and local telecommunication services in Texas. Under Electric Choice, the PUC regulates the delivery of electricity and enforces customer protections.
The reorganization of traditional monopoly electric service to allow operations and charges to be separated or “unbundled” into generation, transmission and distribution and retail services. This allows customers to buy retail electric service from competing providers.
RETAIL ELECTRIC PROVIDER (REP)
A company that sells electricity to customers (residential, commercial, industrial). All Retail Electric Providers must be certified to do business by the PUC of Texas.
RURAL ELECTRIC COOPERATIVE (CO-OP)
A customer-owned electric utility that distributes electricity to members and that receives lower-cost financing through the federal government. In Texas, co-ops can choose to opt into the competitive retail market.
Switching electric service without a customer’s approval. This practice is illegal and penalties are enforced by the PUC.
TERMS OF SERVICE
A contract between a Retail Electric Provider and a customer that outlines fees, length of service and other important information.
TEXAS ELECTRIC CHOICE
The public education program managed by the Public Utility Commission to inform Texans about their options in a competitive retail electric market.
TRANSMISSION AND DISTRIBUTION
The actual delivery of electricity over poles and wires to your home or business. These services are provided to you by your local wires company (utility), which is responsible for maintaining the poles and wires, and responding to emergencies and power outages as always. The PUC still regulates transmission and distribution to ensure the safety and reliability of your electric service.
This is the amount of electricity you used during the billing period listed in kilowatt-hours (kWh). This will be listed on your electric bill as kWh used.
YOUR RIGHTS AS A CUSTOMER DISCLOSURE
A document that informs you of your rights as mandated by the PUC. Retail Electric Providers must provide you with this disclosure.