The vast majority of Texas residential consumers on fixed-rate contracts pay anywhere from 6 to 13 cents per kWh for electricity. However, searches for service in most major metropolitan zip codes on PowertoChoose.org reveal a long list of offers seemingly too good to be true, with several starting at 1 cent per kWh. These offers may appear to be a great deal on the surface, but they are often accompanied by confusing minimum usage requirements, monthly fees, and conditional bill credits. Those conditions can be easily overlooked by eager consumers wanting a bargain on their utility bills.
Compared to the rest of the nation, data from the U.S. Energy Information Administration which publishes annual state electric prices [6] shows that Texas' electric prices did rise above the national average immediately after deregulation from 2003 to 2009, but, from 2010 to 2015 have moved significantly below the national average price per kWh, with a total cost of $0.0863 per kWh in Texas in 2015 vs. $0.1042 nationally, or 17 percent lower in Texas. Between 2002-2014 the total cost to Texas consumers is estimated to be $24B, an average of $5,100 per household, more than comparable markets under state regulation.[7] [8]
Minimum Usage Fees: Often set at or around 1,000 kWh/month, these fees mean you’ll always pay for at least that amount — even if you only use, say, 800 kWh of electricity some months. It sounds nasty, but it’s only something to be concerned about if your electricity bills historically show you hover right around that minimum use threshold. If you’re electricity use always exceeds that amount, it’s like it’s not even there.
At the end of the day, Texas electric companies should be accountable to their customers – and we believe honest pricing is the best way to achieve that. By being open, truthful, and transparent about costs, we make sure consumers can budget confidently, with any “unknowns” kept to an absolute minimum. For more information on Think Energy plans and pricing, contact a sales associate today at 888.252.0078.
As a renter, it’s important to know approximately how much electricity you will use each month in order to get the best deal on electricity. Some electricity plans are cheaper for lower energy usage customers, while other plans are designed with high usage customers in mind. If you’re just moving into an apartment, ask your leasing agent to provide you with historic kWh usage information for your specific unit if possible.
Despite the fact that Texas sees much higher temperatures year round, most households contain and use heating units. These units generate heat in one of four ways: other, propane, electricity and natural gas. Just over half of households in Texas use electricity to run their heating units. This is a much greater average than the overall average for the nation.
8. Study the results. For the selection cited above, several dozen companies recently offered rates in that range. Remember that the lowest rates could come from a company with a poor reputation, but more on that later. Contract lengths varied from one to 36 months. Each service plan comes with links to “Terms of Service,” “Facts Sheet,” “Signup” and “Special Terms.” When you click on these, you learn the nitty-gritty details. Many companies have minimums about the amount of power you must use, or you pay more. Carefully look for language about other fees.
†Offer is available to Texas residential customers who enroll using the Promotion Code “NIGHTSFREE”. Plan bills a monthly Base Charge, an Energy Charge, and passes through Utility Transmission and Distribution delivery charges. Energy Charges for usage consumed between 9pm and 7am each day is credited back on your bill. The utility charges, including delivery charges for night time hours, are passed through at cost and aggregated on your bill. See Electricity Facts Label for details.
Since the Texas electricity market opened to competition in 2002, many Texas residents have had the opportunity to choose their own electricity provider. Instead of relying on their local utility to provide them with electricity, most Texans can choose from a variety of competitive providers, allowing them to shop around for the perfect electricity plan for their homes and lifestyles.
If your monthly use hovers around the 2,000 kWh mark, you’ll be spending around $2,000 per year on electricity bills no matter which REP you choose. With that level of investment, you may be tempted by an offer to get something extra in return — like rewards. Direct Energy is notable because it’s a part of American Express’s Plenti rewards program. For every dollar you spend on your Direct Energy plan, you earn a “Plenti point,” which you can then redeem on purchases with retail partners like Macy’s, AT&T, and Exxon.
Oncor, the state’s largest distribution utility which covers Dallas, Fort Worth and much of North Texas, has already agreed to pass all of the millions of dollars of expected tax savings along to consumers.  Oncor agreed to pass the savings along to customers as part of a rate review which is a formal process in which the PUC reviews the appropriateness of rates being charged by the utility.  No exact details have been determined with respect to how the savings will be passed along. The rate review was actually completed before the tax reform bill was passed but there was a commitment in principle to passing along the savings.  It’s not yet know exactly how much Oncor will save from the lower corporate tax rates but with a $245 million tax bill in 2017 future saving are likely to be in the tens of millions of dollars.
Database of State Initiatives for Renewables & Efficiency (DSIRE) is a company and website that compiles a list of all the energy incentives available in the United States, by a particular state. The idea is to help inform the public about the latest and greatest energy programs and initiatives – all from one location. DSIRE receives funding from the United States Department of Energy and is run by the N.C. Clean Energy Technology Center and N.C State University. Browsing the site programs gives you access to viewing all Texas related initiatives.

TDU Delivery Charge: TDU stands for transmission and delivery utility — in other words, the utility company in your area that is actually piping the energy from the power generation companies into your home. (Remember, REPs in Texas are just the middleman.) The TDU delivery charge is set by the utility and is consistent from plan to plan and provider to provider within its service areas. For example, AEP , the TDU for Corpus Christi, charges the same delivery fee for all TXU, Direct Energy, and Reliant plans. You don't typically get a choice in utility company, and therefore, these fees are pretty much unavoidable, non-negotiable, and won't factor into choosing an electricity plan or provider.
Shopping for a plan based on renewable sources is no different than shopping for any other kind of plan — you calculate your costs the same way, look for the same fees, and weigh in customer satisfaction and other perks. The one thing that’s different is also looking at what percentage of your energy comes from renewable content in the EFL. That number can swing from as low as 0 percent all the way up to 100 percent, with the majority of plans that partially offset energy with renewable content hovering around 15 percent.
The Electric Reliability Council of Texas (ERCOT) does it for you. When you sign up for a plan with a new provider, ERCOT will send you a mailer confirming the switch. You have three days upon receiving the mailer to change your mind. If you don't, you'll have a new provider within seven days, and ERCOT will notify your old provider. Just remember, if you abandon a contract before it's complete, you will be on the hook for any fees or penalties detailed in its Terms of Service.
Shopping for a plan based on renewable sources is no different than shopping for any other kind of plan — you calculate your costs the same way, look for the same fees, and weigh in customer satisfaction and other perks. The one thing that’s different is also looking at what percentage of your energy comes from renewable content in the EFL. That number can swing from as low as 0 percent all the way up to 100 percent, with the majority of plans that partially offset energy with renewable content hovering around 15 percent.
9. Check out your favorite. After you find a company with a rate and contract length you like, learn more about it. One way is to do an Internet search of the company. Place the company’s name in various searches beside these search terms: scam, rip-off and complaints. If the company has a troubled history, find out before you sign up. If only a few results come up from disgruntled customers, don’t worry. But if there are several dozen, continue with a quick search of the company’s Better Business Bureau record. And then, most important, return to powertochoose.org and below the name of the company, you’ll see “Complaint Scorecard” and “Complaint History.” Click on those links and learn more about the company.
Final switch tips. When you make your final selection, don’t call your current electricity provider to cancel. Sign up with the new company only. Try to sign up at least five to seven days before your plan expires so the overlap between the two billing cycles is negligible. Some people switch too late and pay higher prices during the transition. If you have a smart meter, the state rule is you must be switched within 48 hours. But five to seven days is safer.
And just like with any plan, it’s worth it to do the math to see how different scenarios will affect your bill. Take, for example, a home in Sweetwater that uses about 1,000 kWh of energy per month, and is interested in the Texas Essentials 12 plan. Zero percent renewable energy is the cheapest option — but by committing to a $5 monthly charge for its 100 percent “JustGreen” option, it’s actually cheaper than the 60 percent hybrid renewable option.

The Public Utility Commission (PUC) has a website to help you find and compare all the electricity plans and providers in your area. Visit www.powertochoose.org or call 866-PWR-4-TEX (1-866-797-4839).  You can filter your options based on your usage, your preferred plan type, and several other factors. Once you’ve chosen the retail electricity provider that best suits your needs, you can sign up directly from their website.
No worries. It’s always a good idea to shop for a new electricity plan when you are moving to see if there is a better deal on electricity available. But, if you are happy with your current electric rate, most electricity providers will gladly keep you as a customer and continue service under your current contract at your new apartment or house as long as you move within the same utility delivery area. Don’t worry about early termination fees. If you are moving, your electricity provider cannot charge you an early termination fee if you provide a valid proof of a change of address thanks to customer protection rules established by the Public Utility Commission of Texas.
In this free market competing electricity retailers buy electricity wholesale from private power generators to sell at retail to around 85% of Texas residents. The partnership between generators and retailers is governed by the Electric Reliability Council of Texas, or ERCOT, which attempts to balance the power grid’s electricity supply and demand by purchasing small amounts of electricity at 15-minute intervals throughout the day.
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