Houston Electricity Rates and Plans (May 2024)

Houston Electricity Rates and Plans (May 2024)

  • Average Houston electricity rates: 15.88 cents per kWh
  • Average monthly electric bill: $206.44, based on average usage of 1,300 kWh
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Each product and or company featured here has been independently selected by the writer. You can learn more about our review methodology here. If you make a purchase using the links included, we may earn commission.

Here at EcoWatch, we strive for a more sustainable planet and encourage our readers to do their part when feasible. As such, we’ve chosen to highlight some of the best electric companies in Houston that offer 100% renewable energy. The cheapest Houston electricity plan is the Gexa Eco Choice 3 plan from Gexa Energy, with a per-kWh rate of just 8.9 cents. Most impressive is that this plan uses 100% renewable energy but still maintains the overall most affordable electricity rate in Houston. The chart below shows renewable energy plans and prices available throughout the Houston area. 

PROVIDER

PLAN NAME

RATE (¢/kWh) (1,000 kWh plans)*

LENGTH (months)

Gexa Energy

Gexa Eco Choice 3

8.9

3

Rhythm Energy

Simply Choose 3

9.1

3

Rhythm Energy

Power to Shift 3

9.1

3

Chariot Energy

Chariot Choice 3

10.1

3

Rhythm Energy

Simply Choose 4

10.7

4

Rhythm Energy

Power to Shift 4

10.9

4

Gexa Energy

Gexa Eco Choice 12

12.5

12

Octopus Energy

Octo 12 with EV

12.6

12

Octopus Energy

Octo 12 with Smart Thermostat Connected

12.6

12

Gexa Energy

Gexa Eco Choice 24

12.8

24

CleanSky Energy

Embrace Green 36

13.2

36

Rhythm Energy

Power to Shift 12

13.6

12

CleanSky Energy

Embrace Green 12

13.6

12

CleanSky Energy

Embrace Green 24

13.7

24

Chariot Energy

Chariot Choice 15

13.8

15

Shell Energy

Shell Energy Fixed 100% Renewable Plan 36

13.8

36

PowerNext

Fixed Renewable PT

13.8

36

Chariot Energy

Chariot Choice 36

13.8

36

PowerNext

Fixed Renewable PT

14.2

12

Gexa Energy

Gexa Guarantee 12+

14.2

12

*Rates will vary based on your TDU. You’ll see the above rates if your TDU is CenterPoint Energy. These rates include the utility’s current charge of $0.04 cents per kWh. Rates are according to Texas’ Public Utilities Commission and are subject to change.1

On average, a clean energy plan might cost around 1 cent per kWh more than a non-renewable energy plan. If you use 1,000 kWh per month, that will be about a $10-$15 difference.

How to Choose the Best Electricity Plan in Houston

When searching for the best electricity rates in Houston, keep in mind that rates and the average cost of electricity can vary based on numerous factors. That means you may be given a different electric rate than that of your next-door neighbors. Here are a few things that factor into the cost of electricity in Houston:

Types of Electricity Plans

When choosing an energy provider in Houston, you’ll be presented with a few different types of plans. Here’s an overview of the different options offered by most companies in Houston, as well as their pros and cons, so you can pick the best plan for you.

PLAN TYPE

PROS

CONS

Fixed-Rate Energy Plans

  • You’ll have a better idea of what to expect when it comes to budgeting.
  • Your rates remain locked in if energy costs rise.
  • If you cancel early, you could be subject to an early termination fee (ETF), unless you’re moving to an address outside of your electricity service’s coverage area.
  • Some fixed-rate plans will turn into variable-rate plans upon contract expiration. Be sure to read the fine print and ask your energy provider specific questions about length and price.

Variable-Rate Energy Plans

If the price of energy drops, there may be some months where a variable-rate electric customer will be paying less per kWh than someone on a fixed-rate plan.

Variable rates can be very risky given the extreme weather or other factors that can suddenly — and drastically — increase the price of electricity.

Green Energy Plans

  • You can feel good about where your electricity is coming from.
  • You can support clean energy without the large upfront investment of solar or wind energy.
  • On average, renewable plans cost around 1 cent per kWh more than non-renewable plans. (If you use 1,000 kWh per month, that will be about a $10 difference.)
  • They’re not offered by all energy companies, so you’ll have more limited options when choosing a plan.

Fixed-Rate vs Variable-Rate Plans

Just as it sounds, a fixed-rate plan allows you to secure a rate that will stay the same throughout the entire duration of your contract. Note that “fixed rate” does not mean your electric bill will stay exactly the same month over month. Rather, the rate you pay per kilowatt-hour will be fixed. So, your overall bills will still be higher during the months you use more electricity.

If you prefer paying month-to-month instead of being locked into a long-term contract, you may consider a variable-rate electric plan. As implied by the name, variable-rate plan prices are based on variables in the energy market. The price per kWh will increase or decrease depending on supply and demand. We saw the biggest negative impact of variable-rate plans during the February 2021 winter storm, when millions were in the dark due to a massive power outage. Texans who kept their lights on paid the price, with at least one customer facing an electric bill over $16,700.2 Texas power companies were reportedly overcharged $16 billion dollars by the electric grid operator.

Fixed Rate vs Market Rate Electricity Rates in HoustonVariable Rate vs Market Rate Electricity Rates in Houston

Green Energy Plans

Green energy plans are those that supply electricity from renewable energy sources. Those sources will primarily be wind and solar energy in Texas.8

Some REPs may have Green-e Verification or a similar certification to ensure that the electricity is responsibly generated, transmitted and distributed. Non-green energy plans, at least in Texas, rarely meet 25% of their total energy from renewable sources.3 Most green energy REPs will still offer variable- and fixed-rate electricity plans — the main difference is where the energy comes from.

Your Energy Usage

The amount of electricity your household consumes may affect the rate you pay per kWh. Most REPs offer tiered plans based on average energy usage. Tiered-rate energy plans are often called “V-shaped plans” because the rates are more expensive for people who use the least and most amounts of energy and are lowest for those in the middle.

For example, in a typical tiered plan, customers who use around 500 kWh or 2,000 kWh per month will pay more than those who use around 1,000 kWh per month. Data from the Electric Reliability Council of Texas (ERCOT) shows the average home in the Houston area uses 1,300 kWh per month.4

Contract Length

The length of a contract will also play a factor in the cost of your electricity. As with most services, the longer you commit to one provider, the better deal you’ll get. We’ll discuss the different types of electricity plans in the next section.

A word of caution: Read the fine print and ask questions before you sign anything. Many contracts come with startup fees as well as charges for breaking a contract. And while some companies may advertise a $10 cancellation fee, the fine print could read that it’s actually $10 per month left on the contract.

Electricity Facts Label

When shopping for an energy provider, always ask for an Electricity Facts Label (EFL). Similar to a nutrition label you see on packaged foods, an EFL will give you all of the information about a company’s electricity prices, contract lengths and terms, sources of generation, and emission levels.5 Here’s an example of what that’ll look like:

Electricity Facts Label for Houston Homeowners
If you’re interested in seeing the best energy rates you’re eligible for in Houston, you can start comparing prices and plans here. As a trusted energy information source, EcoWatch is often able to secure discounted rates for our readers.

Watchouts

One thing you should always pay close attention to when choosing an energy plan in Houston is the rate structure. Fixed rates mean you’ll never have any surprises, and your bill will only change based on the amount of electricity you use. Variable rates can change based on consumption but also the market price of electricity. Variable rates often look more appealing because they might be lower upfront, but they can spike without warning if demand goes up. Neither is best for everyone, but make sure you know which you’re signing up for.

You should also pay attention to high early cancellation fees. Many companies have cancellation fees of $75 to $100, but make sure yours isn’t significantly higher. Lastly, you should be aware that most contracts include terms that state you’ll be automatically enrolled in a variable-rate plan after the plan expires. You should schedule out a time to review your plan and choose a new one when the current one expires.

There has also been a history of scam activity in Houston and other areas in Texas where energy is deregulated. Some homeowners have reported scammers who call and demand payment for “past-due bills.” Never provide payment information over the phone unless you call your REP directly using the phone number you find on their website. Other homeowners have reported false representatives going door-to-door to collect payment for energy-saving devices that they say will be delivered but never are. Again, never provide payment information to any door-to-door salesperson.

Understanding Deregulated Energy in Houston

Houston is known as the Energy Capital of the World, hosting a slew of headquarters and intellectual capital for pretty much every segment of the energy industry.7 The city has also had what’s called a “deregulated energy market” since 2002, which allows residents to shop for their own electricity providers.8

As a result, there are well over 100 different Houston electric companies that are competing for your business. These companies, also called retail electricity providers (REPs), offer plans that vary when it comes to contract terms, quality and environmental impact. On top of paying your REP, you’ll be charged an additional fee from your transmission and delivery utility company (TDU) to cover the costs of delivering electricity, meter reading, wiring and more.

If you live in the Houston metropolitan area or any of its surroundings, your TDU is likely CenterPoint Energy.3 CenterPoint’s current rates are about 3.9 cents per kWh of power usage, plus a monthly charge of $4.39. You’ll pay these charges no matter what energy plan or provider you choose, and they’ll be baked into the monthly bill from your provider.

Read Also: What Are the Best Energy Rates in Texas?

What’s the Difference Between Utility Companies and Electricity Provider Companies in Houston?

Utility companies are companies that produce electricity, either by running and maintaining solar or wind farms, or by burning fossil fuels to generate electricity. These are similar to what you might envision when you think of a “power plant.” Utility companies generate the power and maintain the delivery systems, including all electric lines, but they don’t deliver electricity to retail customers.

An electricity provider is an intermediary that buys the electricity from the utility companies and then delivers it to retail customers, like homeowners. They handle billing and customer service, but they aren’t responsible for production or maintaining power lines.

There are some benefits to a deregulated electricity market that makes use of both producers and providers. Since multiple providers compete for your business, it generally drives prices down, provided you shop around for the best deal. It also lets you choose a company based on customer service ratings, renewable energy plans and more, rather than being stuck with a single company.

You can choose your provider in Houston, but electricity production companies (utility companies) are assigned to specific areas, so you can’t make any changes there.

Houston Electricity Rate Trends

Year

Average Retail Electricity Price (per kWh)

2014

13.1 cents

2015

11.6 cents

2016

10.5 cents

2017

12.5 cents

2018

12.4 cents

2019

14.4 cents

2020

12.3 cents

2021

13.9 cents

2022

13.8 cents

2023

18.1 cents

2024

17.8 cents

*This information comes from the U.S. Energy Information Administration

Over the past decade alone, the electricity prices in Houston have increased by more than 26%. The prices during the height of the COVID pandemic in 2020 dropped, potentially because residential consumption was higher, which led to production companies easily covering operating costs. You’ll notice in the table above that the highest spike in electricity prices in Houston occurred between 2022 and 2023, representing a 23.8% jump in that one year alone. According to the EIA, the rising cost of acquiring and delivering fossil fuels caused a nationwide jump in electricity prices in 2022, which likely accounts for the spike in Houston.

Choosing an Electricity Plan When Moving to Houston

When you first move to Houston, your home will already have an associated energy production company, as well as a distribution company that manages the power lines and delivery infrastructure. These companies are heavily regulated, so you don’t have a choice which companies serve your home. However, you’ll need to enroll in an energy plan with a Retail Electricity Provider (REP) before you make the move. Most companies take a few days to connect you after you enroll, so it’s best to plan ahead. Some companies do offer same-day connection, but there’s usually a charge for the expedited service.

You can shop for REPs and plans online, and your real estate agent might be able to offer some recommendations. Signing up for an electricity plan is also easiest online, and you’ll just need to provide contact information, your property address, and payment information. If you’re enrolling in a no-deposit plan, your REP will need to run a credit check to confirm eligibility, in which case you’ll also need to provide your social security number.

How to Switch Electricity Plans in Houston

Switching to a new electricity plan in Houston is simple and should only take you a few minutes. You can use the detailed guide below to help find and choose the best plan for your specific needs.
Just follow the steps below to find the best provider and electricity rate for you:

  1. Scroll to the top of this page and enter your zip code.Switching Houston Electricity Plans Step 1
  2. Choose whether you’re switching providers or if you just moved to Texas and need new service. If you’re getting new service, then you don’t need to worry about paying a cancellation fee for your current provider. If you’re currently enrolled in a contract with a different provider, you should contact them or check your contract for information on cancellation fees.
    Some providers don’t charge an early cancellation fee, and others charge $200 or more. In the next step, if you choose to have a live advisor help you, they can do the necessary research for you and potentially even help you reduce the cancellation fee.Switching Houston Electricity Plans Step 2
  3. You have three options to choose from. Advisor Plus+ is a paid service, but a live representative will help you choose the best plan for your needs. This is beneficial, as the cheapest plan isn’t always the best. The advisor will consider fixed and variable-rate plans, go over when you tend to use electricity to get the best time-of-use rates, check your bill to see how much electricity you use per month to secure the best prices and more.
    EnergyBot Advisor is a free service, and a plan is chosen for you based on criteria that you enter. This option delivers a less customized selection, but it should still meet the needs of most customers.
    Standard View is also a free service, but it requires the most work on your part, as you’ll need to look at the plan options and choose one manually. You’ll see the contract term, rate, discounts, renewable energy percentage and more for each plan available in your area.Switching Houston Electricity Plans Step 3
  4. If you chose one of the first two options in the previous step, you’ll get on-screen prompts to help you make the switch from your current provider to the new one selected for you. If you chose the Standard View prompt, you’ll get a list of providers with plan rates and terms, and you can simply click on Select Plan to move forward.Switching Houston Electricity Plans Step 4
  5. Finally, you’ll be prompted with a button that will take you to the provider’s site. You’ll also be told what plan to look for once you’re there to sign up and lock in your new rate.Switching Texas Electricity Plans Step 5

Best Electric Companies in Houston

Badge icon

Constellation Energy

Best National Company

Nationwide Service

EcoWatch rating

Average cost

Pros

  • Many years of experience
  • Great industry reputation
  • Award-winning company
  • No.1 producer of carbon-free energy in the U.S.
  • Makes charitable contributions

Cons

  • Charges contract cancellation fees
  • No prepaid or no-deposit plans
Badge icon

Gexa Energy

Best Rates

Statewide Service

EcoWatch rating

Average cost

Pros

  • Many years of experience
  • Great industry reputation
  • Makes charitable contributions
  • Low rates
  • Wide variety of contract term options

Cons

  • Charges contract cancellation fees
  • No prepaid or no-deposit plans
  • Slightly high number of complaints versus competitors
Badge icon

Green Mountain Energy

Best Green Energy Options

Nationwide Service

EcoWatch rating

Average cost

Pros

  • Green-e certified plans
  • Wide variety of contract term options
  • Low number of customer complaints
  • Many years of experience
  • Makes charitable contributions

Cons

  • Charges contract cancellation fees
  • No prepaid or no-deposit plans
  • No satisfaction guarantee
Badge icon

Reliant Energy

Best Plan Variety

Statewide Service

EcoWatch rating

Average cost

Pros

  • Low number of customer complaints
  • Makes charitable contributions
  • Award-winning company
  • Wide variety of plan options
  • Many years of experience

Cons

  • No satisfaction guarantee
  • Charges contract cancellation fees
Badge icon

TXU Energy

Energy Industry Veteran

EcoWatch rating

Average cost

Pros

  • Wide variety of plan options
  • Many years of experience
  • Great industry reputation

Cons

  • Expensive
  • Not as many renewable energy options as competitors
  • Charges contract cancellation fees
Badge icon

Rhythm

Best Up-And-Coming Company

Statewide Service

EcoWatch rating

Average cost

Pros

  • Low number of customer complaints
  • Values transparency
  • Up to $150 in bill credits to cover switching fee from old provider
  • Charges contract cancellation fees

Cons

  • Young company
  • No prepaid, no-deposit or variable plans
Badge icon

CleanSky Energy

Great Regional Provider

Regional Service

EcoWatch rating

Average cost

Pros

  • Wide variety of contract term options
  • Low number of customer complaints
  • Values transparency
  • All plans use clean energy

Cons

  • Charges contract cancellation fees
  • No prepaid or no-deposit plans
  • Expensive

EcoWatch Methodology on Energy Providers in Houston

At Ecowatch we take a sustainable approach to our best lists. We selected the best energy providers in Houston by examining a variety of different components of the energy providers business. We considered their renewable options or green plans as the most weighted component of our scoring. We looked at how many different types of plans were available, how many years of experience the companies had, what terms and contracts looked like at each company. Lastly, we took a look at the providers track record when it came to delivering the service and customer service. We examined BBB ratings, looked into B Corp certifications, and found out if they offered competitive and fair pricing. All of these factors helped us decide which companies to recommend and which superlative to award!

FAQ: Houston Energy Plans

At EcoWatch, we frequently receive energy-related questions from readers in Houston. Here are the most common questions we see, along with our answers:

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Article author
Dan Simms is an experienced writer with a passion for renewable energy. As a solar and EV advocate, much of his work has focused on the potential of solar power and deregulated energy, but he also writes on related topics, like real estate and economics. In his free time — when he's not checking his own home's solar production — he enjoys outdoor activities like hiking, mountain biking, skiing and rock climbing.
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Expert reviewer
Melissa is an avid writer, scuba diver, backpacker and all-around outdoor enthusiast. She graduated from the University of Florida with degrees in journalism and sustainability studies. Before joining EcoWatch, Melissa worked as the managing editor of Scuba Diving magazine and the communications manager of The Ocean Agency, a nonprofit that’s featured in the Emmy award-winning documentary Chasing Coral.