June 6th 2008 Riverway files for Bankruptcy! 4 Electric Providers Gone this Summer
Riverway over the last few months sold electric prices way below the market price most energy providers in Texas were pricing at. The prices looked a little too good to be true and sure enough all they were doing is buying their electricity on the MCPE market without hedging their investment and selling it as a fixed rate. Riverway was a provider just like National Power who tried to pass the loss in investment when rates went up to their fixed rate customers. The point to a fixed rate is that you are buying hedged energy that cannot go up. Riverway was selling unhedged energy and like rolling the dice that the market would not go upside down on them, they lost that bet. The PUCT would not let them pass on the cost to the customer and they had to eat that loss. Like 3 other electric companies that went out of business under similar circumstances, Riverway Power is another down by bad risk management.
Riverway Power is also known as Sure Electric, LLC and is a retail electric provider operating in Houston Texas. The electric company is managed by seasoned Texas electric company professionals who have been a part of the deregulation process in Texas since 2002. Riverway Power is working to expand beyond Texas to 17 other deregulated states throughout the United States.
Update on Riverway Power Electric Provider
James wrote in that Riverway Power recently canceled his 1 year fixed electric rate contract due to natural gas price increases. Many do not know this but most of the electricity in Texas is generated using natural gas. When a Texas electric company like Riverway Power buys your energy they buy the commodity natural gas. If they do not buy and hedge the commodities they sell as electricity carefully, they have to cancel their energyÂ agreements or go bankrupt. If your energy contract was not honored with Riverway Power please feel free to let us know by commenting below so we can warn others.
Monty wrote on April 19th, 2008 at 11:47 am about Riverway Power, “They just canceled my contract. This was very upsetting as it is a pain in the rear to switch power providers and then they pull a bait and switch on you.”
What Should I Do, I No Longer Have an Electric Company?
If you were a Riverway Power customer you have been switched to the POLR company or the Provider of Last Resort. This is a back up plan where the Texas state government moves you to a new provider so you will not be without service. The POLR rate is very high, somewhere around 22 – 30 cents kWh depending on your location. You want to pick a competitive Texas electric provider ASAP! We have some discount 12 month fixed rate offers below. Bounce Energy has several different fixed rate plans in our comparison chart and Trieagle Energy follows close by and has several different fixed rate terms. Both of these Texas Power companies are reputable electric companies with no danger of going out of business. Bounce Energy has the cheapest available electric rates at this time.
Low Cost Texas Electric Providers
For Low Cost Residential Electricity with a solid reputable electric provider in Texas we recommend Bounce Energy. Sign up with Bounce on their discounted fixed electric rate in the chart above, that will not change for the entire term of the contract.
If you live in or around the Houston area you will find the best electric rate with Bounce Energy – Learn More Above!
Riverway Electric Company
Riverway Power boasts that their company is set a part from the other Texas electric providers because of their 360 degree customer focus approach. Lousy customer service is something Riverway Power works to avoid however many new electric providers get it wrong when it comes to billing their customers correctly and staying in business for the long term. As of recently they have put a huge ding on their reputation by not honoring low cost 12 month fixed electric rate contracts they were selling Texas consumers at around 11.1 cents kWh. A few more years will tell if Riverway Power will be here for the long haul or will be like many new comers that have come into Texas to do business only to leave due to a failed billing system and or unprofitable sales from bad energy trading and hedging policies within their risk management departments.
The most likely reason for Riverway Power raising their customers fixed rate electric contracts is because of not hedging their energy correctly. Most people who are familiar with Riverway Power from this incident will never trust that their fixed rate residential electric rate product is truly fixed. If I was in the shoes of James or Monty who had their fixed rate electric contract cancelled on them I would now consider any rate Riverway offers as a variable electric rate.
We sincerely hope Riverway Power will be a success story but with any new Texas electric provider these issues are always a worry and so it is good to take a cautious look when picking an energy company. If you are a commercial business or residential home and you lock in at a low rate you want to feel confident that they will not leave the state with a broken electric agreement. This would leave you with the new job of finding a different electric provider at a higher market rate. We are not saying stay away from Riverway Power but you do need to be careful with new electric providers.
Contact info for Riverway Power
You can reach Riverway Power electric company at this number: 866-321-1520. After the April 2008 incident of the adjustment in what was a fixed electric rate contract many people have called Electricity Bid explaining that they haven’t been able to reach Riverway Power.
How to File a Complaint
If you believe you have been sold a bait and switch as described in the Deceptive Trade Practices Act you may wish to file a formal complaint with the Texas attorney general Greg Abbott: Complaint Form
To file a complaint with the Public Utility Commission of Texas click here: PUCT Complaint Form
Other Electric Companies Following in Riverway’s Footsteps
Prebuy Electric and National Power Company have both had issue with not hedging their energy properly. Now that fuel costs are so high they are left eating their loss or passing this on as a higher electric rate to their customers. Prebuy Electric Company has filed for bankruptcy today and National Power Company attempted to raise their customers electric rates from around 11 cents kWh to 15 cents kWh even though the rate was supposed to be locked anywhere from 6 months to 18 months depending on the monthly term they signed up for. As of June 16th several customers of a well known provider, Dynowatt, have also been complaining that they too have had their fixed electric rate broken by Dynowatt Energy. After calling Dynowatt to confirm this is not actually true. These Dynowatt customers were on a variable electric rate or just coming off their fixed rate contract. The list of electric companies affected by the volatile summer energy market in Texas has grown to over 6 providers. Some are wondering if Dynowatt will go out of business like Riverway and National Power.