Consumer Strategist
Arlington Consumer Strategist - November 30, 2007
by Donny Eisenbach

The Federal government which is a highly standardized machine has chosen the Texas Deregulation plan as the primary source for creating their own electricity deregulation

standards for all 50 states.  Having a standard market design that has been proven over a 4 year period in Texas to be accepted by the Federal government says volumes about the success of deregulation in Texas.
The Texas’ competitive electricity market system will soon become the benchmark that all 50 states use in their deregulation process.

The electricity market will continue to be run by the Texas PUC but the federal control will come in the form of regulations sent down for the Retail Electric Companies to comply with when selling energy outside the state of Texas.  Texas went beyond the federal governments anticipation so much so that the federal government looks to Texas for how to proceed.  One of the main components of the Texas’ deregulation system is the use of a Regional Transmission Operator (which is a position held by the Texas state agency ERCOT) and open access to transmission.  The federal government is following right along requiring similar rules and regulations.
Texas has so many power-generating plants that they do not need to do plant pricing individually as do other states but instead they can price by region.  This makes the Texas system less restrictive, easier to price and regulate. 
Some think Texas will have to price generating plants per plant in order to fall in line with Federal regulations but we believe Texas will be allowed to continue to price by region.   
In 5 – 10 years you will see the rest of the U.S. mimicking the rules and regulations of the electricity market in Texas rather than Texas bending to federal regulations.