3 minute read • Graham Lumley • Last update May 2024
If your residential electricity provider (REP) goes out of business in Texas, don’t worry — your home will not lose power.
Instead, your home’s electricity will be switched to what is called a Provider of Last Resort, or POLR. This is a system implemented by the Electric Reliability Council of Texas (ERCOT) and executed by the Public Utility Commission of Texas (PUCT) to ensure that Texas homeowners and renters do not suffer a power outage if their provider shuts down.
POLRs are not meant to act as long term electricity service providers. Rather, they are meant to be a temporary stopgap to ensure you don’t lose your connection to the Texas power grid.
Providers of Last Resort are designated by the PUCT and assigned by TDU region. Here are current Texas POLRs:
If you paid an electricity deposit at the start of your contract with the original provider, they are required to pay any unused portions of the deposit back to you.
If for any reason, you had any outstanding credit balances, that will be returned to you as well.
In the situation where you owed money to the provider, you may be required to finish paying off your debt.
You have a 60 day window to choose a new provider and plan. It is highly recommended to switch away from your the month to month plan assigned by your POLR as soon as possible for two main reasons.
To secure savings on your energy bill, start searching for a new provider as soon as possible. We advise Texans to enroll in a simple, fixed rate electricity plan without base charges or usage fees.
When a POLR signs on new customers to these month to month plans, they are assuming a lot of risk.
In a more typical new customer acquisition situation, a provider will purchase energy in advance based on the term length a customer signed up for (e.g. 12, 24 or 36 months).
When a POLR receives a new customer on a month to month, they do not know how long the customer will remain on the month to month contract. So it is more difficult to buy energy in advance. This leads to higher energy charges on month to month plans compared to long term fixed rate plans.
When shopping for a new electricity plan in Texas, there are many things to look out for in order to find the plan that will help you save the most money.
The most important thing to remember? Always, always, always check the Electricity Facts Label (EFL) before signing up for an electricity plan.
If your previous electricity provider has gone out of business and you’re looking to switch from your POLR (provider of last resort), consider BKV Energy.
We are proud to offer Texans simple, transparent, and affordable fixed rate electricity that can help you save up to $500 or more year.
Choose our Bluebonnet plan and enjoy Premier+ benefits at no cost, the most power-packed benefits program in Texas.
Enter your zip code to explore plans in your area.
