DEREGULATION Today, deregulation is bringing change to the Texas power industry. At Navasota Valley Electric, we don’t intend to take part in deregulation until we’re sure it’s right for our members. Change is Coming Change is coming to the way Texas energy suppliers and customers do business. Deregulation of the state electric industry will permanently alter the Texas energy landscape. In January of 2002, Texas allowed many retail power consumers to choose their electric generation suppliers. The law is designed to introduce the benefits of the marketplace to electricity consumers. Unfortunately, results haven’t always matched expectations. The painful example of California-skyrocketing rates and rolling outages-underscores the uncertainty that accompanies deregulation of any major industry. Although no one expects the California nightmare to be repeated in Texas, neither can anyone confidently predict deregulation’s ultimate impact. Will deregulation benefit consumers ? In theory, deregulation should lower electric rates. Whether this will actually happen remains to be seen. Other states have had mixed results with electric deregulation. For that matter, other industries, such as airlines and telecommunications, have undergone deregulation with results that have not always benefited consumers. Deregulation is an experiment whose ultimate outcome cannot yet be confidently predicted. Why co-ops have a choice in deregulation When the Texas Legislature approved electric restructuring in 1999, it exempted cooperatives and municipally-owned systems. Why? Because these services are owned by their customers and run on a democratic business model. Co-op members, for instance, elect their board of directors, which in turn set co-op policy. Does this mean that co-ops cannot deregulate? Not at all. It means that co-ops may choose to opt in or out of deregulation. Unlike electric distributors elsewhere in the state, coops and municipally-owned systems have a choice. This gives rural electric cooperatives a unique advantage: the opportunity to “ wait and see” if the state deregulation experiment will benefit their members-owners, especially in the rural markets where the cooperatives primarily operate. Not until we’re sure it’s right. Navasota Valley intends to go on serving their members as they have for over sixty years. We intend to go on providing the same superior service, personal attention and affordable rates our members have come to expect. And if deregulation is right for our members, we intend to go ahead. But not until we’re sure.