General Information on Texas Electricity Rates

You’ll find that Texas has some of the lowest electric rates in the country. However, Texas electricity providers that offer renewable energy tend to have a higher per kilowatt-hour (kWh) rate. According to the EIA (Energy Information Administration), Texas is the largest electricity-producing state and the largest wind-based energy provider in the country.

For all Texas residents, your electricity bill is divided into two categories – supply and delivery services.

The supplier services include energy companies that generate electricity. Their energy costs depend on the cost of electricity generation, and that depends on how the electricity is produced. Some of the common electric providers in Texas (including major cities, such as Houston and Dallas) are Direct Energy, TXU Energy, Gexa Energy (Gexa Saver), Pulse Power (Texas Saver), and Frontier Utilities, among others.

Each energy provider offers various plans and electricity rates; you can read their EFL (Electricity Facts Label) to learn more. The EFL includes information such as the electricity prices, cancellation fees, and early termination fees, among other things.

The delivery services are provided by your local utility company. It’s also called the TDSP (Transmission Distribution Service Provider) or the TDU (Transmission and Distribution Utility). Your utility company delivers your electricity, manages power outages, and maintains the transmission network.

Your delivery charges include energy delivery costs and the cost of maintenance. Other fees include the PUC Assessment – a fee included by the Public Utility Commission of Texas (PUCT). You may also find non-recurring fees and a Gross Receipts Reimbursement Charge.

Depending on where you live, Texas is serviced by Centerpoint Energy, Oncor, AEP North, AEP Central, and TNMP.

You can learn more about Texas electricity rates and tariffs here.

Energy Deregulation and How It Affects Texas Electricity Rates

Power to Choose in Texas allows all Texans to choose their Retail Electric Supplier (REP). You can find various Texas energy plans from different energy providers.

The energy market has helped reduce Texas electric rates below the national average. Furthermore, Texas residents can now also buy electricity from energy companies offering green energy plans.

If you don’t choose an energy supplier, you will receive supplier services from the Provider of Last Resort (POLR). Depending on where you live in Texas, you will receive the Standard Offer Program offered by your utility company.

The Standard Offer Program rate is also your Price to Compare. You can use it to compare the rates and plans offered by other energy supply companies

Finding the Best Texas Electricity Rates

Texans can choose from several retail electric providers and opt for an electricity plan that works for them. Most electricity companies offer competitive energy rates, while others offer benefits, such as free nights.

In any case, you can compare each company’s plans and rates to decide upon a REP. You can search and try to shop for rates yourself, but watch out for the fine print, hidden fees, and escalating rates once your term ends.  

Alternatively, you can use Arbor’s free TrueRate Protection service to automatically find and switch to the best Texas electricity rates in your area.

Arbor scans the market and gives you the best rates you can get in your service area. When your contract term is expiring, Arbor finds the best rate and switches you again. You always pay the best rate and never have to worry about overpaying for electricity ever again.

You can also use the free savings calculator to find out how much you could save in each case.

Understanding Texas Electricity Rates and Plans

Every supply company offers different plans with various rates, plan lengths, and bill credits. Some offer variable rates, and others offer benefits.

Changing your supplier is straightforward – you can use a copy of your energy bill to find out your current plan, energy provider, and rate. You can use Arbor to find the best rate in your area and switch to the lowest cost supplier quickly to save time.

You can use Arbor to find the best rate in your area by using our free savings calculator.

Furthermore, you will find different types of plans depending on the companies. These are the four plan options you’ll find in Texas.

• Fixed-Rate Plans: Such plans let you pay the same rate every month, regardless of any fluctuations in energy prices. We recommend fixed-rate plans because they provide price certainty and minimize risk.  But be careful:  when your term expires, your rate becomes variable and can go up without notice.  Arbor automatically keeps you on the best fixed-rate plan, so you don’t have to worry about rate hikes at the end of your term.
• Variable-Rate Plans: Variable-rate plans depend on the average price of electricity in the energy market. That means your monthly rate can fluctuate depending on the demand – when demand is low, you may get low rates, but when demand is high, you’ll be paying more regardless of your average usage.
• Green Energy Plans: Texans can choose green energy plans to avoid a carbon footprint. However, such plans tend to have higher electric rates.
• Prepaid Electricity Plans: Such plans don’t require any credit check or deposit; it allows Texas residents to pay for energy in advance.

Some plans may ask you for a deposit. However, plans available through Arbor never require a deposit.

How to Choose the Right Energy Supplier

All Texas residents get their energy delivery from their local utility company; however, they can choose from several REPs. You can use the Price to Compare or your current rate to find the best rate in your service area.

To find the best electricity rates, you should check what company offers the best hassle-free plan based on energy usage, along with the most savings and benefits.

You can also check out how you can save on your energy bill with your local utility company. But electricity is complicated, which is why people trust Arbor to manage their electricity service for them, so they always pay the best electricity rate available in Texas.

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