By Dave Lieber

For me, the good news about Texas electricity is that I have used five different power companies in the last five years and not once has the power gone out for any reason other than bad weather.

Uninterrupted power. That’s about the only good thing I can say.

Otherwise, it’s all bad. Costs are too high. Companies offer such confusing rates and service plans that many Texas consumers feel like victims of bait-and-switch schemes. And those whose electrical provider went bust found themselves slammed into high-cost plans.

The Texas Legislature started this mess in 1999, when it passed a law deregulating the electricity marketplace. Until recent months, Texans were paying some of the highest electricity rates in the nation.

State lawmakers met again in 2009 and did not pass legislation that would have made some of the shady marketing practices illegal. Fortunately, the Texas Public Utility Commission issued some new pro-consumer pricing rules that went into in May 2009. Shopping for an electricity contract is now simpler and fairer than before. Click here to read the new rules.

Why should you care? Answer: as I originally shared exclusively with readers of the Fort Worth Star-Telegram – one of Texas’ finest newspapers – you can save hundreds of dollars a year. When it comes to making your family’s decision about which power company to choose, you have to be your own watchdog. Sometime in 2010, when your current contract is set to expire, you will have to make major decisions:

Will you stay with your current company or switch to an unknown? Should you extend the contract for a year, a half-year, three months or go month-to-month? What about a fixed rate versus a variable rate?

Here’s The Watchdog’s gift to you – The 2010 Guide to Picking the Best Electricity Provider:

1. TXU no longer rules. Get over the idea that TXU Energy, most likely your original provider, is the only company that can offer solid, uninterrupted service. And don’t believe the fallacy that TXU customers get serviced first when power goes out.
2. Oncor Electric Delivery is responsible for maintaining the transmission system. Everybody, TXU and its many competitors, uses them to handle repairs.
3. Switching is good. Act under the assumption that you should switch companies every year. The market is constantly changing.
4. You can find better deals and save hundreds of dollars a year, maybe even more, with this one decision. Electricity is measured by kWh, or kilowatts per hour. If you pay 10 cents a kWh instead of 14 cents, your monthly electric bill could be $100 or more lower.
5. Know your current contract terms. Before you can shop, know what you have. Do you know your kWh rate? It’s on your electric bill, and it might be higher than what’s available now. (In Texas, it ranges from 8 cents to as high as 25 cents.) Also call your provider and ask for the date when your contract expires. Find out, if you don’t know, whether your rate is fixed or variable. Start planning a possible switch two months before a contract expires.
6. Decide whether you want to play it safe or be a gambler. Do you want to lock in a fixed rate that you can afford for a longer period of time? Or are you willing to take a low price now and understand that a variable rate could spike depending on market conditions?
7. Conduct a thorough search. Go to this Web site: www.powertochoose.org. (If you don’t have an Internet connection, visit your public library and ask your librarian for help. Or ask a friend or relative to help you.) Click on “Go Directly to Offers”, and then enter your zip code. Also, check the company’s own Web site. Sometimes the company’s price might be cheaper than powertochoose.org
8. Pick your poison. In the left-side column, under “Rate Type,” pick either fixed or variable. (The Watchdog likes fixed since current market conditions are too volatile.) Under “Price,” type in a range of from 7 cents to 14 cents. That’s a good spread. Then hit submit.
9. Study the results. For the selection cited above, about a dozen companies last week offered rates between 8.9 cents per kWh and 13 cents. Contract lengths varied between three and 24 months. Each service plan comes with links to “Terms of Service,” “Facts Label,” “Signup” and “Special Terms.” When you click on these, you learn the nitty-gritty details.
10. Check out your favorite. After you find a company with a rate and contract length you like, learn more about them. Return to the original page, www.powertochoose.org, and click on “Customer Complaint Statistics.” The link marked “Residential Retail Electric Provider Complaint Scorecard” leads you to a state scorecard showing complaint ratings for a six-month period based on a four-star system, similar to movie ratings. Except, here, you don’t want four stars. Another link on the home page, called “REP Complaint Summary,” shows you what the complaints were about.
11. Check out other sources. If the company comes out good enough on complaints, dig a little deeper. What are angry customers saying about this company? To find out, use an Internet search engine this way: Put the name of the company in between quote marks and then follow it with the word “ripoff.” Do the same with the word “scam.” If only a few results come up from disgruntled customers, don’t worry. But if there are several dozen, do a search for the company’s name and “Better Business Bureau.” You’ll be able to pull up the company’s report in the BBB region of its headquarters.

Final switch tips. When you make your final selection, don’t call your current electricity provider to cancel. That could cause problems. Sign up with the new company, and it will handle the transfer. Try to sign up at least four to six weeks before your plan expires so the overlap between the two billing cycles is negligible. Some people switch too late and pay higher prices during the transition.

Remember, there’s no loss of power when you switch. It happens, and you don’t even know it.

Until the bill comes.