The deregulation of the electrical power industry has had an effect in the states where this change has been made. Texas is one of the states where the power companies have been deregulated. What has that done for the average electric consumer? Well, the first thing it did was give them the power to choose their power provider. I know, it sounds kind of funny, but it is true. The way it was set up before, the customer had to pay whatever rate the local power company told them they had to pay. Now, the power customer can shop around for the best price or other features desired.
The power generation grid in the United States is made up of a whole bunch of power generation facilities both big and small. There are coal-fired, nuclear, wind, solar and hydroelectric power generation facilities spread out over this nation. The wires that carry this electricity along with all of the switching equipment form a power grid. All of the power companies feed electricity into the grid at varying rates at different times. The electric meters on the houses and businesses let the companies know how much electricity each customer is using.
So, a deregulated state system can have a customer in the southern tip of the state pay for power from a power company very far away. The company selling the power will know how much to bill them based on the meter readings. Therefore, even though the actual electrons of electricity you may be using are coming from any of the grid connected power companies, the billing and power generation works out based on the knowledge of what each customer is using. It might sound complicated, but computerization takes care of it easily. This makes it so you can shop for cheap power, green power or pay for power based on some other desire or need rather than being forced to just choose your local power company.