Court fight shows breaking up hard to do for NRG, electricity sales firm
By L.M. Sixel
Updated 11:48 pm CDT, Wednesday, August 22, 2018 Houston Chronicle
For about 15 years, the Houston sales company 7 Point Group sold electricity door-to-door, at grocery stores and during special events on behalf of NRG, the largest electricity seller in Texas, with brands such as Reliant Energy, Green Mountain Energy and Pennywise Power.
Business was so good that this spring NRG and 7 Point executives sat down over a steak dinner to talk about growth strategies, recalled 7 Point’s president, Marco A. Romero III. But just a couple of weeks later, the long relationship came to a crashing end with a late night phone call from NRG telling Romero that he and his company were fired.
“It made no sense,” said Romero, who estimates his 300 or so agents were responsible about 70 percent of NRG’s outside sales.
Now, the one-time business partners are in the middle of a nasty breakup, fighting in court over non-compete agreements and whether 7 Point used confidential NRG information to sell electricity for rival companies. For the moment, 7 Point has essentially shut down after a state district court in Harris County ordered the company to temporarily stop selling electricity in Harris County and most places in Texas. The 7 Point Group has appealed that ruling.
The legal dispute, now before the state’s Fourteenth Court of Appeals, will likely drag on for months, but it opens another window on Texas’ deregulated power markets and the fierce competition among electricity retailers to sign up customers. As with other mature markets, such as credit cards and cell phones, the way to grow is to poach customers from competitors, prompting aggressive tactics to lure those customers away.
In Texas, most of the selling of electricity plans is done by marketing companies hired by power providers. The marketing firms use armies of sales agents to pitch plans at grocery stores, sporting events or door-to-door. Good sales people can make six-figure incomes, industry officials say.
NRG paid 7 Point as much as $325 in commissions for each new customer, according to court records. The 7 Point Group has several contracts with NRG, including one signed four years ago to sell electricity plans door-to-door in Texas and others to pitch NRG plans at retail stores and community events, according to court documents.
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