Texas electricity rates & plans

Texas residents and businesses can choose their electricity providers from a competitive market. You don’t have to explore energy rates and compare plans alone, though. With Choose Texas Power, you can compare energy providers, find cheap Texas electricity rates, and sign up for a plan in one place. Enter your ZIP code or call the number on your screen to get started.

Average electricity rates in Texas

The most recent average residential energy rate in Texas is 14.74 cents per kWh, an 11% decrease compared to the national average of 16.43 cents per kWh. The latest commercial electricity rate in Texas is 8.73 cents per kWh. These rates are according to recent data from the Energy Information Administration (EIA).

How to switch electricity providers in Texas

You might switch providers if you’re unsatisfied with your current plan, your contract is ending, or you’re moving outside of your current provider’s service area. You may incur an early termination fee (ETF) if your contract is not over. Read your plan’s Electricity Facts Label (EFL) to find the fee details. Many providers will waive the ETF if you are moving outside the service area.

Follow this simple step-by-step process to switch electric providers.

• Check your status. Ensure you live in a deregulated area and review your current provider and rate to make comparisons.
• Enter your ZIP code. Filter and compare available energy plans in Texas based on price, plan type, and terms to find providers in specific cities such as: Houston, Dallas, and other available cities.
• Pick a plan and sign up. Sign up on ChooseTexasPower.org or call the number on your screen to speak with an energy advisor.

How to compare the best electricity plans in Texas

When searching for affordable electricity plans, it’s important to understand the following key factors: 

1. Your Electricity Facts Label (EFL): The EFL is a critical resource containing essential details about your chosen plan, such as the rate, the amount of renewable energy, contract length, and more. Read this document carefully to understand your payment structure.
2. Your energy consumption: Your household’s monthly electricity consumption can significantly influence the rate you are charged. Many energy providers offer plans structured with tiered rates. Within a tiered rate structure, the charges vary depending on your usage level.  These usage levels fall into specific tiers — typically 500 kWh, 1,000 kWh, or 2,000 kWh. Explore the EFL for plan details on the rates for each usage level
3. Your location: The area you live in can impact your electricity rate. Local utility companies set transmission and delivery fees (often known as TDU or TDSP charges), which can fluctuate based on your city.
4. Your contract length: Energy companies often provide lower rates if you opt for a longer contract period. However, most fixed-rate plans require an early termination fee (ETF) if you cancel your electricity service early. Before enrolling in a plan, consider whether the term length is the right fit for you.

Texas energy deregulation explained

Texas deregulated its electricity market in 2002. Since then, residents and businesses in many cities across the state have been able to choose their own electric provider instead of defaulting to the local utility company. Electricity providers across Texas offer competitive rates to gain business.

Deregulation can be a lot to navigate. Choose Texas Power is a free resource curated to help you find an energy provider with a plan that fits your needs. Our guides can help you learn about buying energy in a deregulated market. We’ll explain the types of plans you’ll encounter, how to choose an electricity plan, and what to do if you want to switch to a different provider. You can also search for specifics about electricity rates in your city.

Texas Electricity FAQs

Why are Texas electricity rates so high?

The latest electricity rate in Texas is 14.74 cents/kWh, 10% lower than the national average. Texas experiences hot weather during much of the year. The Lone Star State’s large population and size impact electricity rates because it requires solid infrastructure and transmission capabilities. This need can lead to high operational costs for electricity providers.

Where can I compare electric rates in Texas?

Choose Texas Power is a marketplace to search, compare, and sign up for the best electricity plans in Texas. Enter your ZIP code and compare plans. Sign up online or call the number on your screen to get started.

Who has the best electricity rates in Texas?

Electricity rates vary by provider and location. The best rates depend on your energy interests. After entering your ZIP code, you can filter the available plans by feature, rate type, and length to find the best rate for you. If you’re interested in a 100% renewable energy plan, explore available options from Gexa Energy. If you’re searching for the lowest rates, check out available 4Change Energy or Flagship Power plans in your area.

Will Texas electricity rates go up?

Texas electricity rates tend to rise in the summer between June and September when energy demand is higher. Shopping for electricity plans in the spring and fall may help you secure the lowest rates.

What’s the difference between an energy company and a utility company in Texas?

In deregulated areas, energy providers and utility companies have different roles. Providers sell and manage your energy plan, while utilities deliver the energy to your home, maintain power lines, and manage power outages. You choose your electricity provider and energy plan, but your utility company is assigned to you based on location.