Energy Texas launched its solar program in late 2022 after spending the fall, in part, planning the launch. We had two goals with the program launch:
- Attract enough solar customers to help our largely residential business flatten some of its naturally sharp usage curves during hot afternoons. That enables the business to procure power more efficiently and enables us to pass on savings in the form of lower prices across the business.
- Create an innovative offering that would help not only attract solar customers but keep them on over the years. We’re proud to be buying and supplying renewable power and building a base of solar customers felt on-brand with that.
Given the ambition of those goals and our young life as a start-up in this highly competitive market, we knew we’d have to take some chances with our offering to stand out. We wanted to be aggressive to make it worth it for the potential customers.
We ultimately crafted an offering that incorporated multiple differentiators, including: enabling the billing technology to keep bill credits for sell backs into perpetuity as long as the customer remained with us; including TDSP charges in the bill credit opportunity; and allowing customers to sell back to the grid at their energy charge.
A full solar program was new to us despite our extensive experience as a team in the retail electricity space. We made business assumptions regarding the TDSP charges being predictable enough that we would be able to sustain this differentiated perk. We still see it that way. We knew we didn’t want people to experience the concept of “losing” their bill credits simply because they didn’t consume “enough” in a given period. We stand by this, as we are also consumers who have experienced companies handle this in less favorable ways, such as airline companies and their rewards programs. Finally, we made a business assumption and calculated risk on the energy charge payback component based on historical data. This analysis was flawed. We take responsibility for that mistake. Once we collected enough data in size and scope to identify the error in mid-March, we knew we would need to make a significant change quickly and make our customers immediately aware.
After careful consideration and business analysis, we ultimately realized with the sell backs that due to real time clearing prices shattering the floor of historic lows, selling back something in which we were being paid $10/unit and then paying someone else $60-75/unit was not just a poor business outcome, but one that could not be sustained.
Our solar program is product based. It is not an electricity plan. It has Terms & Conditions that can be altered as needed to accommodate business operations. This is established with the customer at sign-up. The changes we contemplated and acted upon for the solar buyback product did not have any impact on customers’ electricity plan’s Terms & Conditions. We continue to honor plan Term & Conditions, as is, and as we’ve done in the electricity arena for decades. The program change made, to let the sellback price match the real time market price up to the energy charge, matches some of the more aggressive solar programs in ERCOT. All other solar perks were kept in the program.
Considering a solar program competitive analysis of all the plans & programs available in the market, we believe that the program, even with the changes, stands up against any competitor.
With that all considered, we knew the existing customer base would not be pleased with a change to the product’s Terms and Conditions, which we understand. We planned for a solution that would be the best possible answer for our solar customers already being served. First, we chose to announce the changes quickly, which we did. Changes were made internally less than a week after the original analysis. Second, we put a window of time of over 10 weeks ahead of implementing the changes so that customers could prepare and make proactive choices. Third, we offered to all solar customers choosing to leave due to the program changes, a waived early termination fee (ETF) through the months of March, April and May. Finally, we added an offering for surge pricing to solar customers selling back to the grid, above their energy charge. This aligns with our business mission of helping customers use less of what we sell.
As a company we are proud to say that most of our solar customers understood our program changes from a business perspective, have reviewed the market, and have stayed with us, for which we are thankful. Our solar program continues to grow, which is affirming that we are heading in the right direction. That said, we have heard from several customers who were dissatisfied and took advantage of the waived early termination fee and have left. We understand. Some customers left us very vocally which has not felt great, but that is the power of a competitive landscape. The few who have sent us death threats, wished us bankruptcy, personal poverty, taken their anger out on our customer care agents, or who have sent us personal emails wishing us terminal illness – we cannot say we were sad to see go. While we understand the anger associated with finances and the perception of a goal post move, let us not forget that the voices on the other end of the line and inbox are human as well.
Given the feedback over the last two months, I felt compelled to address the solar buyback program changes publicly.
Thank you to all who have understood this change for what it is- a business decision made for the health and longevity of the company. We appreciate your business and as Texans serving Texans- hope to grow & prosper in this market while we continue to help you use less of what we sell.
Energy Texas CEO