Customers Facing Big Power Bills When Contracts Lapsed

Two North Texas electricity customers tell NBC 5 Responds they’re facing big bills - months after the 2021 winter storm. Their contracts with their energy provider lapsed at a time when energy prices soared because of the February crisis.

Consumer advocates say the storm underscored why customers need to take action before their contracts end.

“That’s when the panic set in”

When Bobby Diaz opened the electricity bill for Odd Muse Brewing Company in May, the small business owner thought it was a mistake. It showed he owed $20,095.

Diaz said typical electricity bills for the brewery in Farmers Branch range from $900 a month to $1,300 per month.

“You're talking about a year and a half worth of electric bills in one month,” said Diaz.

When he called his retail electric provider, Diaz said he learned his fixed-rate contract lapsed two weeks before the winter storm. The brewery ended up on a month-to-month variable rate plan – where rates go up or down depending on the market.

During the crisis in February, the price of electricity shot up.

“That's when the panic set in,” said Diaz.

Diaz said his energy broker reached out earlier in the year with a new contract that Diaz didn’t sign – by mistake. Diaz also said he didn’t catch a contract termination notice from his provider, Engie Resources, because it ended up in a spam email folder.

“It was always my intention to be on a fixed rate,” said Diaz.

“It just so happens the one month our contract lapsed was the snowstorm. Had it happened any other month of the year, we wouldn't be in this situation,” Diaz added.

Greg Smith, the owner of GSR Motorsports in Fort Worth, said his fixed-rate contract with Engie also lapsed during the winter storm leaving him with a $1,936.11 bill.

“The overall bill was about six and a half times higher than what I'm used to,” said Smith.

Typical bills are usually around $300 a month in the winter, he said.

“Had my contract ended on the 20^th, that probably would have been a non-issue. It's just bad timing,” said Smith.

Engie Resources said it can’t comment on individual customers. Engie tells NBC 5 Responds that before a customer’s fixed-price contract expires, Engie provides notice and options to renew.

The electricity provider also said, “The extreme energy prices during the winter storm were set by ERCOT – not Engie Resources.”

Engie also pointed out, “ERCOT has already charged Engie Resources for energy consumed during the storm and we have already paid ERCOT these prices in order to continue serving our customers.”

Engie said some customers received February billing in May because it put a temporary hold on market-based bills to verify prices from ERCOT and meter reads.

Track contract end dates, look for required notices

The Texas Public Utility Commission said it requires retail electric providers to give written notice of a contract ending - at least 30 days or one billing cycle prior to the contract expiration date for residential customers and at least 14 days prior to the contract expiration for small commercial customers.

When a contract ends and a customer doesn’t pick a new plan, PUC rules say customers’ electricity service should still continue with the same provider’s month-to-month option.

Tim Morstad, associate state director with AARP Texas, said it is critical consumers confirm their contract expiration.

“Make sure that when you sign up for a 12-month plan, that just before those 12 months are up, that you are searching for a new plan, that you are in touch with your current provider to see what your options are, that you affirmatively make a choice rather than not taking any action,” said Morstad.

Set a calendar reminder on your phone and be on the lookout for contract expiration notices from your provider. They may come in a paper bill, on a separate page. They could also come in email, if you’ve opted into email communication with your provider – explained Morstad.

Check spam and junk folders too.

“There's a lot at stake here, especially as we've learned through the February storm. If your contract was coming due in that week in February and you rolled on to a month-to-month or variable-rate plan, you could have been hit badly,” said Morstad.

Diaz and Smith said Engie offered deferred payment plans.

Diaz told NBC 5 Responds that Engie eventually reduced his bill by over $15,000 after Diaz reached out to the utility about being able to manage a more than $20,000 energy bill.

“We just coming out of COVID and everything is starting to pick back up and we get hit with this thing,” said Diaz.

Diaz said the utility offered a 24-month payment plan and a five-year fixed rate agreement.

Diaz said he stayed with Engie. Smith said he went to another provider. Both customers said they are back on fixed-rate plans.

Steps to take if you believe your bill is incorrect or you can’t pay

The PUC said if you believe your bill is not correct or you didn’t receive notice of a contract expiring, reach out to your retail electric provider first. Then, contact the PUC and file an informal complaint.

The PUC will send the complaint to the provider who has 21 days to respond to the PUC.

If there is still no resolution, customers may be able to pursue a formal complaint process which is heard by commission members.

If you’re facing a utility bill you can’t pay, talk to your electric provider about payment plans.

You can also call 2-1-1 to find nonprofits in your area that may be able help.

The Texas Rent Relief program is also distributing utility assistance for residential customers. You can check your eligibility and apply here.

NBC 5 Responds is committed to researching your concerns and recovering your money. Our goal is to get you answers and, if possible, solutions and a resolution. Call us at 844-5RESPND (844-573-7763) or fill out our customer complaint form.