Texas Electric: What Is a Provider of Last Resort & Why You Want to Avoid Them

Anything with the phrase “last resort” in it is probably something you want to avoid — unless you’re talking about scoping out Caribbean vacation spots (as in, that last resort we toured was gorgeous). When it comes to energy, you don’t want to be in the “last resort” club.

As it relates to Texas electricity, following is what a Provider of Last Resort (POLR) is, and why you want to avoid being a part of their roster.

What is a Provider of Last Resort?

Actually, from a consumer standpoint, a POLR is a good thing. They are Texas energy companies that act as a back-up in case an existing service provider goes out of business.

Texas electricity consumers have a deregulated energy market, which has produced the need for POLRs. Why? Because with deregulation came a lot of competition. And, some of these new companies had neither the market savvy nor the secure financial backing it takes to be in business for the long haul.

Many of them came on the scene offering Texas electricity consumers low rates, but they couldn’t deliver when certain market forces shifted. So, they went out of business – leaving thousands of customers potentially stranded.

Enter POLRs. The Public Utility Commission of Texas (PUC) designated certified retail electric providers (REPs) to act as POLRs for each customer class in each electric utility service area open to competition.

While this is a comfort, it can be a nightmare in that there is no guarantee that the rate you paid with your old Texas electricity company is the one you’ll get with your new one. And, if you’re already paying the high cost of a prepaid electric service plan, your costs could escalate even more.

Why It Pays to Choose a Traditional Texas Electricity Company

This is why it pays to sign on with a traditional Texas energy supplier – even if it means saving up to pay a deposit. Although, many have low-deposit and no-deposit electric service plans you may qualify for. All it takes is a phone call to find out.

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