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Texas Electric Deregulation Plodding Along

Texas Electric Deregulation Plodding Along

Texas' electricity markets would open to competition Jan. 1, 2002 if a bill making its way through the state legislature passes the senate. An earlier version of the bill passed the senate, but another vote is required there since the legislation changed in the house. The governor has voiced his support for deregulation.

The legislation would freeze rates of investor-owned utilities until competition begins Jan. 1, 2002, and then would lower those rates 6%. Appropriate consumer protections would have to be followed by all retail electricity providers. The first-ever program to help low-income residents, including low-income elderly and disabled, pay bills and improve home energy efficiency would be established.

Stranded cost recovery is provided for, and securitization may be used as a mechanism for recovering those costs. Stranded costs in Texas are estimated to be has high as $9 billion. The legislative session ends May 31.

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