In deregulation of power markets, one instant problem with pricing is that incumbent electricity suppliers would certainly undercut the rates of new participants, stopping competition and also continuing the existing syndicate of suppliers. Thus, the SB7 bill introduced a phase-in period throughout which a rate flooring would certainly be developed (for incumbent electrical energy business) to prevent this predatory method, permitting new market entrants to become developed. As of 2007 Texas capitalist had energy affiliates no much longer have price to defeat tolls.
In this totally free market competing electrical energy sellers buy power wholesale from private power generators to offer at retail to about 80% of Texas residents. The collaboration between generators and merchants is regulated by the Electric Dependability Council of Texas, or ERCOT, which attempts to balance the power grid's electrical power supply and also need by acquiring small amounts of electrical energy at 15-minute periods throughout the day.