When Texas’ wholesale power prices spiked unexpectedly in 2008 due to problems with power line congestion, a handful of small electric retailers went out of business, leaving tens of thousands of customers on higher-priced plans with back-up providers.
When power prices spiked again this February due to a lengthy cold snap shutting down power plants, one firm went out of business, but it happened in a much less disruptive way for the customers.
After prices spiked this summer due to record-breaking heat and record power plant outages, the impact appears even more subdued: just one company, NRG Energy, said it was adjusting its expected earnings downward to account for money it lost during the spikes.
Even NRG CEO David Crane expressed a bit of surprise during the call announcing the adjustment that the fallout from the August price spikes wasn’t being seen more widely among Texas electric retailers.
But could the impact be going on a bit more quietly behind the scenes?
DPi Energy, a retail electric provider that specializes in pre-paid plans, said this week it is being bought out by Houston-based TruSmart Energy for an undisclosed amount. DPi was owned by Ed Lateef, who also owned one of the big losers of the 2008 power crunch, Riverway Power.
In September, New Mexico utility PNM Resources sold its First Choice Power retail business to Direct Energy.
And in late August, Canadian-firm Just Energy said it was buying Fulcrum Energy’s three Texas electric retail firms Tara Energy, Amigo Energy and Smart Prepaid.
OK, so it’s not clear if these sell-offs of smaller retailers to those with deeper pockets is the result of this summer’s woes. It could simply be a trend that started in the Spring when the successful retailer StarTex Power was acquired by Constellation Energy.
But one way or another, the impact will likely show up in consumer bills.