Texas power company grows
Irving’s Vistra Energy purchasing provider from Connecticut, will surpass NRG as the biggest U.S. seller of residential electricity
Vistra Energy is buying a Connecticut power provider in a deal that will make the Irving company the nation’s biggest seller of residential electricity as the industry continues to consolidate.
The Irving power company Vistra Energy is buying a Connecticut power provider in a deal that will make Vistra the nation’s biggest seller of residential electricity and expand its market share in Texas as the industry continues to consolidate.
Vistra recently said it would pay $328 million to acquire Crius Energy of Norwalk, Conn., in a deal that would expand Vistra’s footprint to 19 states and add another million customers, bringing the total to 3.9 million cus-
tomers — about 1 million more than its rival NRG, of Houston and Princeton, N.J., serves nationally. Crius owns several brands that sell power in Texas including TriEagle Energy, Energy Rewards and Viridian Energy, although neither Vistra nor Crius disclosed how many customers the brands serve here.
Vistra, whose best known brand is TXU, still lags NRG in Texas, where NRG has been on its own buying spree. NRG Energy sells about 31 percent of the electricity sold in Texas, followed by Vistra Energy, with 23 percent, and Direct Energy, a unit of the British-owned Centrica, with about 10 percent, according to NRG, which presented market share data to analysts last year.
These big players are moving to become bigger. In its most recent deal, NRG paid $44 million last year to acquire several retail electric providers and brand names that added 115,000 new customer accounts, according to financial records. In June, NRG paid $219 million for Xoom Energy, an electricity and natural gas retailer in 19 states and Canada that added another 300,000 customers.
Direct Energy has also had its checkbook out, buying a competitor Source Power & Gas of Sugar Land, a subsidiary of an Australian company ERM Power last fall. Source had 4,000 customers in seven states, including Texas.
The increasing concentration could eventually mean higher prices as fewer players compete for customers. “It’s net negative for the consumers,” said Trent Crow, founder of Houston-based Real Simple Energy, a website that searches for the cheapest electricity plans.
Texas has 27 fewer residential retail electricity sellers in 2018 compared to the previous year, according to a Public Utility Commission report for the Texas Legislature. The Houston area had 51 retail electric providers last year, down from 55 in 2017.
While Power to Choose, the electricity shopping website sponsored by the state, looks jam-packed with options, many of those brands are owned by the same companies. Vistra, in addition to TXU, owns 4Change Energy and Express Energy. Centrica owns Bounce Energy and First Choice Power as well as Direct Energy. NRG owns Reliant Energy, Cirro Energy, Pennywise Power, Green Mountain Energy and Discount Power, which NRG bought in October from Volterra Energy Holdings.
“There is an illusion of choice,” said Adrian Shelley, director of the Texas office of the consumer advocacy organization Public Citizen.
Vistra Energy declined to comment. NRG spokeswoman Pat Hammond said her company’s acquisitions won’t change the robust competitive market in Texas. State regulators agree, noting, among other factors, that new competitors can easily enter the Texas retail power market.
Vistra’s purchase of Crius is subject to regulatory approval and is expected to close in the second quarter.