Texas beats to the drum of its tune, which also goes for electricity. Texas deregulated its energy market. You can choose your electricity provider for a better rate. But with all that freedom comes a little confusion. This guide helps you navigate Texas electricity. Understand plan types and find a wallet-friendly rate. Keep yourself illuminated.

Texas is one of 17 U.S. states to deregulate its energy market, according to the Environmental Protection Agency (EPA).

• Compare Texas Electricity Rates, Plans and Prices

Texas Energy Deregulation: What does that mean? 

Thanks to deregulation, unlike most states, Texas lets you choose your electricity provider. Multiple Retail Electric Providers compete for your business.

These REPs offer a variety of plans with different rates, contract lengths, and even eco-friendly options. This competition keeps prices competitive, giving you the power to shop around and find the best fit for your budget and preferences.  Go green with a renewable energy plan, or prioritize affordability with a fixed-rate plan - the choice is yours!

In short, deregulation empowers you! Shop around and find the perfect electricity plan for your Texas home.

Shop affordable Texas electricity rates

Finding cheap Texas electricity requires comparing plans online. Use these tools to compare rates, contracts, and fees. Read the details closely, focusing on fixed vs variable rates, contract terms, and any offered discounts or incentives. Look for deals like sign-up bonuses or free off-peak usage.

Compare Electricity Rates in Texas (April 2024)

Find the best plan for you

First, analyze past bills to understand your typical usage and target the right plan size. Next, use online tools and consider your priorities (price, free hours, renewable energy) to compare plans and find the best rate.  Finally, read the fine print to avoid hidden fees and snag the perfect plan for your home.

The best plan for you depends on your individual needs and priorities. Consider factors like:

Here's a more concise and impactful rewrite focusing on questions that guide decision-making:

• Fixed costs or potential savings? Know your budget comfort level with price fluctuations.
• Energy habits matter! Analyze consumption patterns to find the best plan structure (fixed, variable, time-of-use).
• Flexible schedule? Time-of-use plans reward adjustments to off-peak hours.
• Go green? Decide if a premium for renewable energy aligns with your priorities.

What types of energy plans are offered in Texas?

• Fixed-Rate: Predictable costs for a set term (great for budgeters).
  • Pros: Predictable costs with a locked-in rate for the contract term (typically 6, 12, 24, or 36 months), ideal for budgeters.
  • Cons: Rates may be higher than variable plans if market prices fall during your contract.
    • Choose fixed rates for budgeting peace of mind, but be aware you could miss out on potential savings.
• Variable-Rate: Potentially lower costs, but prices can fluctuate.
  • Pros: Potentially lower costs than fixed plans, especially with favorable market conditions. Freedom to switch providers quickly for better deals.
  • Cons: Rates fluctuate with the market, leading to unpredictable bills.
    • Lower costs & flexibility, but bills can fluctuate. Choose wisely!
• Renewable Energy: Support clean energy sources (may cost slightly more).
  • Pros: Support the environment with renewable energy sources like wind or solar power.
  • Cons: Rates may be slightly higher than traditional plans.
    • Power your home, power the planet. Choose renewable energy! (May cost slightly more)
• Time-of-Use: Save by shifting usage to off-peak hours (requires planning).
  • Different electricity rates are offered based on the time of day. This allows significant savings for those who shift usage to off-peak hours.
  • Cons: Requires planning and adjustments to daily routines to maximize savings. May not be ideal for inflexible schedules.
    • Save big by shifting usage, but require flexibility.
• Prepaid: Pay upfront for electricity (good for managing your budget).
  • Pros: Provides upfront control over your energy budget. You prepay for a set amount of electricity.
  • Cons: Requires careful monitoring of your usage to avoid running out of credit. May not be ideal for those who struggle to estimate their energy consumption.
    • Control your energy bill & avoid overspending (requires monitoring usage).

Additional Considerations:

• Some providers may offer bundled plans that combine electricity with other services. This could include natural gas or home security monitoring.
• Look out for hidden fees like early termination fees or enrollment charges when comparing plans.
• The best plan for you depends on your individual needs and priorities. Consider your budget, risk tolerance, and lifestyle when making a choice.

Texas Electricity Rates Trend

Electricity rates in Texas are trending downward! This is thanks to a surge in renewable energy like wind and solar power, along with advancements in technology and energy efficiency. Competition keeps prices low. Fluctuations happen from weather or policy changes. The overall outlook, however, is bright: sustainable and cost-effective energy for Texas!

As of April 2024, expect to pay around 14-16 cents per kWh for your Texas home's electricity, including delivery charges. This reflects a roughly 20% increase over the past five years. While experts predict rates to hold steady in 2024, a potential decrease in 2025 hinges on market conditions and weather.

Average Texas electricity costs

Texas electricity rates are lower than the national average!  The typical Texan pays around $162.17 monthly at 14.58 cents per kWh (April 2024). But your rate can range from 10.9 cents to 23.5 cents depending on location and plan. Shop around to find the best deal and keep those bills low!

How do you find the best electricity rates in Texas?

Finding the best Texas electricity rate is simple thanks to deregulation! Here's how:

• Know your usage: Check past bills to estimate your average monthly kWh consumption. This helps target plans for your usage level.
• Use comparison tools: PowerToChoose.com by the Texas Public Utility is a great resource. Independent sites like Choose Energy or EnergyBot can also be helpful.
• Prioritize your needs: Price matters, but some plans offer extras like free off-peak hours or renewable energy. Decide what's most important.
• Read the fine print: Avoid hidden fees and early termination charges. Understand all plan terms before signing up.

The difference between utility companies and electricity providers in Texas

The Utility Company (TDSP): Think of them as the highway itself. They own and maintain the power lines, poles, and infrastructure that deliver electricity to your house. They're also responsible for reading your meter and handling power outages.  You don't get to choose your utility company: it's assigned based on your location, similar to having just one main road through town. Examples of Texas utility companies include Oncor, CenterPoint Energy, and AEP Texas.

The Electricity Provider (REP): Now, picture the car on that highway. This is your electricity provider, often called a Retail Electric Provider (REP).  Unlike the utility company, you have a choice here! REPs compete for your business by offering various electricity plans with different features. These plans can have:

• Rates: Fixed rates offer predictable costs, while variable rates can fluctuate with market prices.
• Contract lengths: Choose a plan with a term that suits your needs, like 6 months or 2 years.
• Some Retail Electric Providers offer bonuses such as free nights and weekends. Others have plans that use solar or wind power.

EcoWatch Methodology on Energy Providers in Texas

EcoWatch understands that Texans care about the environment. Electricity providers prioritize strong "green plans" powered by solar or wind. The focus on sustainability is shown in their scoring system. Texans can choose a plan that fits their budget and environmental values.

How to switch electric plans in Texas?

Switching Texas electricity plans is a breeze! Here's how:

• Know your usage:
  Check past bills for your average monthly kilowatt-hour (kWh) consumption or use Smart Meter Texas (https://www.smartmetertexas.com/) for real-time data (if available). This helps you compare plans with rates suited to your typical usage.
• Focus on kWh rate:
  Don't be fooled by free nights or weekends: the kWh rate is the crucial cost per unit of electricity used. Compare kWh rates across different plans to find the best deal. Watch out for additional monthly fees that can add to your bill.
• Time it right:
  Aim to switch within 14 days of your current contract ending to avoid early termination fees.
• Easy enrollment:
  Choose a new provider and enroll online or by phone. They'll handle the switch from your old provider, ensuring a smooth transition to your new plan.

Understand your usage, focus on the kWh rate, and time your switch. Find the perfect Texas electricity plan to save money.

Renewing Your Texas Electricity Contract

• Avoid Auto-Renewal: It's convenient, but it might not be the best deal. Set a calendar reminder to check your expiration date well in advance (ideally 14 days before) to allow time for comparison shopping.
• Shop Around: The electricity market is changing! The plan that was once the most affordable might not be anymore. Use online comparison tools to check if other Retail Electric Providers (REPs) have better rates.
• Negotiate (Optional): Loyalty and usage history can be bargaining chips! Depending on your situation, you might be able to negotiate a better rate with your current provider.
• Go Green: Concerned about the environment? Explore plans with a higher percentage of renewable energy sources. EcoWatch's evaluation system is a helpful resource for finding eco-friendly providers.
• Think Long-Term: Are you expecting big changes in your electricity usage? A month-to-month plan might offer more flexibility. If not, a fixed-rate plan can provide stability for a longer term.

A little effort can save money and support the environment.  Check your expiration early (14 days!), shop around for better rates, negotiate if possible, explore renewable plans (EcoWatch helps!), and pick the right term length (fixed for stability, month-to-month for flexibility).  This simple checklist turns your renewal into a win-win!

What About Small Businesses?

Running a restaurant, a law office or a franchise location isn't the same as powering a home. Ambit Energy offers fixed-rate plans for small businesses. If you're shopping for your business, you can request business plan options for your address.

The difference between distribution utilities and retailers

Here's an analogy to understand the difference, Imagine a water delivery system. The distribution utility would be the company that owns the pipes and delivers water to your neighborhood. The retailer would be the company that bills you for the water you use and might even offer bottled water delivery on top of tap water.

Delivery to consumers - U.S. Energy Information Administration (EIA)

Distribution Utilities: The Delivery Guys

Distribution utilities are the unseen heroes behind your electricity. They own the power lines and infrastructure. They act as middlemen delivering electricity from generators to your neighborhood. Typically, they're the only provider in your area and their rates are regulated by the government.

Retailers: Choice and Competition

Retailers are the ones you buy your electricity from. In deregulated states like Texas, you have a choice! Retailers compete for your business by offering different plans and rates. They buy electricity in bulk and sell it to you, sometimes even with eco-friendly options or additional services.

Texas utility companies

Here's a list of some of the major Texas utility companies:

• AEP Texas (serves over one million customers in the western and northern parts of the state)
• CenterPoint Energy (serves the Houston metropolitan area)
• Oncor Electric Delivery (serves Dallas-Fort Worth, Tyler, Waco, Midland, Odessa, Wichita Falls)
• Texas-New Mexico Power (TNMP) (serves Lewisville, Pilot Point, Leonard, and Glen Rose)

It's important to note that these are just transmission and distribution utilities (TDUs). They are the companies that own the infrastructure that delivers electricity to your home or business.  In Texas, you can choose your retail electricity provider (REP) from a variety of companies.  The REP is the company that bills you for the electricity you use.

Compare Electricity Rates in Popular Texas Cities

• The Public Utility Commission of Texas offers Choose Your Electricity Provider (CYE). You can compare plans from Retail Electricity Providers in your area by entering your zip code and estimated usage. It provides details on plan types, rates, contract terms, and customer reviews. (https://www.puc.texas.gov/)
• Several websites compare electricity rates from different REPs in Texas. These can be helpful for a quick comparison, but be sure they are up-to-date. Here are some reputable options:
  • Electricity Rates.com - Texas Electricity Companies:
  • (https://www.texaselectricrates.com/)
  • Power Wizard: (https://www.powerwizard.com/)
  • ComparePower: (https://comparepower.com/)
  • Popular Texas Cities and Estimated Averages (for reference only):

Popular Texas cities have varying estimated average electricity rates. Remember, these rates are not guaranteed.

City & Estimated Average Rate (kWh)

• Houston 14.80¢
• Dallas 14.00¢
• San Antonio 15.20¢
• Austin 14.50¢
• Fort Worth 14.00¢
• El Paso 13.80¢
• Corpus Christi 15.40¢

In Texas, you're not stuck with just one electricity company! You can shop around and pick the company that offers the best rate for your needs.

The average Texan pays around 14.25 cents per kWh, but this can vary depending on your location, usage, and chosen plan.

Consider factors like plan type (fixed vs. variable), contract length, and any included features or discounts when comparing rates.

Several online resources can help you compare electricity rates in Texas, including :

• SaveOnEnergy: https://www.saveonenergy.com/electricity-rates/,
• ElectricityPlans: https://electricityplans.com/texas, and
• Choose Energy: https://www.chooseenergy.com/electricity-rates/texas.

Do your homework before choosing an electricity plan in Texas! Check the prices offered by different companies and think about how much electricity you typically use. This way, you can find the cheapest plan that meets your needs. It's like buying shoes - you compare prices and sizes to find the best fit for your feet!

Hope this has been helpful my Ambit friends! Please share your comments below…

Sincerely,

Shawn Cornett

(210) 232-6032 | [email protected]

Ambit Energy National Consultant
Co-Founders Impact Award
Co-Founders Leadership Council
Nine Time 5-Star Club Qualifier
Pacesetter, Powersurge & Pure Energy Award Winner
Most importantly… the 2013 Ambition Softball MVP 🙂