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Dealing with Disconnections and Payments for Electric Utilities

How to prevent disconnections of electricity

The best way to prevent the disconnection of your electricity is to stay in contact with your electric provider when you have trouble making your payments.  Take advantage of available payment assistance, the weatherization program, or other energy efficiency programs that will reduce your usage while maintaining your usual level of comfort and service.  Make alternative payment arrangements.  Ask for a deferred payment plan and a levelized or average payment plan where you would pay the same amount every month.  Most important, make sure you agree only to a deferred payment arrangement you can afford to pay.  If you default on the deferred payment plan you will be disconnected.   

Note: If you are having problems with a delinquent bill your (Retail Electric Provicer (REP) is required to offer you a deferred payment plan.  Your REP (Retail Electric Provicer) is required to provide you a deferred payment plan only if you meet the REP’s (Retail Electric Provider's) credit requirements.  As explained next, more lenient standards apply when the weather is extreme and during the summer months even if the weather is normal.  

Special payment arrangements

During a heat advisory or extended below freezing weather your electricity cannot be disconnected under state law, even if you have prepaid service. REPs (Retail Electric Providers) must provide you a deferred payment plan or advance you credit on a prepaid service plan.  

To receive the special payment plan the customer must contact the REP (Retail Electric Provider).  In July, August and September many customers are eligible for a deferred payment plan or a level billing plan.  This includes low-income customers receiving the LITE-UP TEXAS discount and critical care and chronic condition customers that express an inability to pay. Critical care is a medical status for households with a member on life support equipment.  Chronic condition is a medical status that indicates serious long-term illness that makes a person extremely sensitive to temperature as is the case with multiple sclerosis patients. 

Customers that do not receive the LITE-UP discount and are not critical care or chronic care qualify for payment plans during the summer if they meet the three criteria. 

These are:

1) be a customer of the REP (Retail Electric Provider) for at least 3 months. 

2) have no disconnection of electricity service in the past 12 months.

3) Have no more than 2 not sufficient funds (NSF) charges in the past 12 months.  

Switch-hold

If a REP (Retail Electric Provider) extends your credit under special payment arrangements during the summer or during extreme weather the REP (Retail Electric Provider) can place a “switch-hold” on your account. A switch-hold is an electronic flag that is placed on your account that means you owe debt that must be paid to your current retailer before a switch to another REP (Retail Electric Provider) will be processed.  

Prohibited disconnections of electricity

Under certain circumstances, a regulated electric utility is prohibited from disconnecting a customer.

These circumstances include:

• When there is a heat advisory in effect 

• When temperatures are below freezing for more than 24 hours 

• On weekends or holidays or the day immediately preceding where there is no one available to accept payment

• When the customer establishes that disconnection of service will cause some critical care person residing at the residence to become seriously ill or more seriously ill

• When the company receives a pledge, letter of intent, purchase order, or other notification that the energy assistance provider is forwarding sufficient payment to continue service.

 

Timeline for disconnection of electricity–standard service

Under PUC rules, a customer can be disconnected for nonpayment on the 26th day past the due date of the bill.  Sixteen days after the due date of the bill, the electric company sends a notice that service will be disconnected in ten days if payment is not received. Municipal utilities and rural electric cooperatives are not required to follow these standards.  You will have to ask the utilities to provide you with their collection schedule and disconnection procedures.  

Timeline for disconnection of electricity–prepaid service

New rules for prepaid electric service went into effect on June 1, 2011.  When you have prepaid service you must pay before you use the electricity.  You do not receive a monthly bill.  As you use power, the cost of that power is deducted from your account.  The REP (Retail Electric Provider) will monitor the amount of money remaining.  When it drops below a certain amount you will receive an electronic disconnection notice anywhere from one to seven days prior to disconnection.  Disconnection notices for prepaid customers must be electronic. 

Electric utility security deposits

The PUC (Public Utility Commission) rules establish credit requirements for the provider of last resort and competitive REPs (Retail Electric Providers).  The provider of last resort must allow a customer who does not meet other credit requirements to pay a security deposit.  Competitive REPs (Retail Electric Providers) set their own credit requirements and can refuse service to a customer if those credit requirements are not met.  The REP (Retail Electric Provider) has the option of allowing the customer to pay a security deposit to meet credit requirements.  

The PUC’s (Public Utility Commission's) customer protection rules place a cap on security deposits.  The rules say a security deposit may not exceed the greater of 80 days (one fifth of average annual usage) or the next two months’ estimated bills.  

Customers who qualify for LITE-UP TEXAS must be allowed to pay a security deposit over $50.00 in two installments. 

Security deposit waivers

Under the rules a customer 65 years of age or older that is not delinquent in payment of any electric service account meets credit requirements sufficient to avoid payment of a security deposit.      

Another special provision is: “A residential customer may be deemed as having established satisfactory credit if the customer has been determined to be a victim of family violence as defined in the Texas Family Code §71.004, by a family violence center or by treating medical personnel.  This determination shall be evidenced by submission of a certification letter developed by the Texas Council on Family Violence.  The certification letter may be submitted directly to the REP (Retail Electric Provider) or POLR (Provider of Last Resort).” 

A customer may also waive a security deposit if the customer is medically indigent.  The criteria can be found in PUC Subst. R. Subchapter R §25.478(a)(3)(E).  This is a standard based on income at or below 150% of the federal poverty guideline and inability to perform three activities of daily living (bathing, dressing, grooming, routine hair and skin care, meal preparation, feeding, exercising, toileting, transfer/ambulation, positioning, and range of motion). 

Late fees

A REP may not charge late fees on the bills of customers enrolled in the LITE-UP TEXAS program.