May 13 - McClatchy-Tribune Regional News - Elizabeth Souder The Dallas Morning News

Electricity retailer National Power Co. promised customers a fixed rate of around 11 cents per kilowatt-hour. Last week, the company took that promise back.

National Power sent form letters to some of its customers on May 6 telling them that the fixed rate will rise to around 15 cents per kilowatt-hour, depending on their location and the amount of power they use. The change will happen in 45 days.

Customers who don't want to pay the higher rate have a month to terminate their fixed contracts and avoid a $300 cancellation fee.

By Monday, a dozen customers had complained to the Public Utility Commission, but PUC lawyers haven't been able to reach National Power leaders.

"Our legal staff at this point has some serious concerns," said PUC spokesman Terry Hadley.

Officials with Houston-based National Power didn't respond to phone calls on Monday, and the customer service line didn't work properly for part of the day.

It's not clear how many customers the rate hike affects.

The letters illustrate the buyer-beware nature of Texas' deregulated electricity market and call into question whether any fixed rate is truly fixed.

Power prices are rising, and no Texas company offers fixed-rate service for 11 cents anymore. The cheapest fixed-rate offers Monday cost around 13 cents per kilowatt-hour.

National Power's letter invokes the "material change" clause in its customer contracts. Under the clause, the company can hike the price for a fixed contract if there's a "material change." But the company doesn't define the term, and the letter doesn't explain the reason for the rate hike.

According to PUC rules, a company can change the terms of service if it gives customers 45 days' notice and tells them how they can terminate service.

Cedar Hill resident Tony Wright received a rate hike letter and said he's frustrated because he just signed up for service to begin this month.

He had been on a more expensive contract with another provider and wanted to switch to National Power. He waited until his previous contract was up to avoid a cancellation fee. This time, he said, National Power should pay him a fee.

"They want to charge $300 for an early termination fee, but they're not offering to pay a $300 termination fee" for dropping the plan, he said.