Compare Texas Electricity Rates [2022 Best Prices]

Jump To: Texas Energy Rates | Price Comparison | How to Find the Best Rates | Types of Electricity Plans | Best Electricity Companies | What to Look For When Choosing a Provider

In 1999, a piece of legislation introduced in Texas unveiled the concept of deregulated energy. Senate Bill 7 (SB7) requested the elimination of regulated energy rates and monopoly providers, and would — according to lawmakers — drive the low prices of energy in Texas even lower.¹

Today, the majority of Texans live in a deregulated service area, which means they have the power to choose their own energy provider. While the idea seems simple enough, deregulated energy can be a confusing industry to understand, and many consumers wind up paying way too much. In this article, we’ll compare energy rates and plans in Texas so you don’t overpay for electricity.

Texas Energy Rates

About 85% of Texans live in a deregulated service area, meaning they have the power to choose their own electricity provider. Three of Texas’ largest cities — Dallas, Houston and Fort Worth — are deregulated, while the other 15% of the state, including Austin and San Antonio, remain regulated by electric cooperatives.

However, there are some zip codes in deregulated areas that will have regulated energy, and vice versa. You can enter your zip code into this tool to see if deregulated energy is available near you.

For many Texans who can choose their own retail electricity provider (REP), the process of doing so is overwhelming. After all, there are over 150 providers, each offering different energy rates, plans and contract terms.

Along with paying your REP, you’ll be charged monthly fees from your transmission and delivery utility company (TDU) to cover the cost of delivering electricity, meter reading, wiring and more. 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 REP. All TDU rates are regulated by the Public Utility Commission of Texas (PUCT).

Unlike with REPs, you cannot choose your TDU, as it depends on where you live. The three main TDUs in the state are AEP, CenterPoint and Oncor, each serving millions to tens of millions of customers in different areas of Texas. The smallest utility company is Texas New Mexico Power, serving more than 260,000 customers in the western part of the state.²

Let’s dive into Texas’ electric companies and price points, plus how to navigate finding the cheapest energy rates in Texas’ deregulated energy market.

To find the best electricity rates in Texas, we recommend comparing prices from a few companies. As a trusted energy information source, EcoWatch is often able to secure discounted rates for our readers. You can use this tool or the buttons below to be connected with local energy providers near you.

Best National Company

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Comparing Texas Electricity Prices

Here at EcoWatch, we strive for a more sustainable planet and encourage our readers to take action to improve the environment whenever feasible. As such, we’ve chosen to highlight some of the best electric companies in Texas that offer 100% renewable energy.

The chart below shows renewable energy plans and prices available throughout the Lone Star State. Keep in mind that these electricity prices may not be exact, as rates can fluctuate daily and may vary depending on where you live. For instance, if you live outside of densely populated metropolitan areas, you’ll likely enjoy rates even cheaper than what’s below.

Oncor Energy Electricity Rates

^{*Rates will vary based on your TDU. You’ll see the above rates if your TDU is Oncor. 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.3}

CenterPoint Energy Electricity Rates

^{*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.4}

AEP Texas Electricity Rates

^{*Rates will vary based on your TDU. You’ll see the above rates if your TDU is AEP Texas. These rates include the utility’s current charge of $0.05 cents per kWh. Rates are according to Texas’ Public Utilities Commission and are subject to change.5}

How to Find the Best Electricity Rates in Texas

When searching for the best electricity rates in Texas, keep in mind that rates and the average cost of electricity can vary based on numerous factors, so you may be given a different electric rate than that of your neighbors. Here are a few things to consider:

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. According to the EIA, the average Texas home uses around 1,132 kWh per month.⁶

Contract Length

The length of the contract will also play a factor in the cost of your electricity. As with most things, 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. Many contracts come with startup fees as well as cancellation fees for early termination. And while some Texas electricity providers advertise a $10 cancellation fee, the fine print may read that it’s really $10 per month left on the contract.

Electricity Facts Label

When shopping for energy, always ask for a provider’s Electricity Facts Label (EFL). Similar to a nutrition label you see on your favorite snacks, 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.⁴ Here’s an example of what to expect on an EFL:

If you’re ready to pick a plan, you can use this tool or click below to be connected with an energy provider in your area. Or, keep reading to learn more about the types of energy plans available to Texas residents.

Best National Company

5/5

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Nationwide Service

Best Rates

4.5/5

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Statewide Service

Best Plan Variety

4/5

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Types of Electricity Plans in Texas

Most Texas electric companies will offer a few plan options for customers to choose from. Here’s an overview of the different types offered in the Lone Star State, as well as their advantages and disadvantages, so you can pick what’s best for your household.

Fixed-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 that your electric bill will be exactly the same every month. Instead, it means the rate you pay per kilowatt-hour (kWh) of electricity won’t change. So, your bills will still be higher during months you use more electricity.

Variable-Rate Plans

If you prefer paying month-to-month instead of being locked into a length-based contract, you may consider a variable-rate electric plan. Variable rate means — you guessed it — the price you pay is based on variables in the energy market. The price per kWh will increase or decrease depending on supply and demand.

We saw the biggest risk of the variable-rate plan during the winter storm of February 2021, 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 $16,700.⁷ Texas power companies were reportedly overcharged $16 billion dollars by the electric grid operator.

^{With a variable-rate plan, prices change each month based on the market rate of electricity. Some months, you’ll pay less than homes with fixed-rate plans, and others, you’ll pay more. You may also see surprisingly high bills during extreme fluctuations.}

No-Deposit and Prepaid Energy Plans

Many power plans require a deposit upon signing a contract to protect the REP from losses should a customer be unable to pay their energy bill. However, certain companies will offer a no-deposit electricity plan option so long as the customer passes a credit check. If the customer doesn’t have a high enough credit score for no-deposit electricity, they can still avoid paying a deposit by opting for a prepaid, or “pay-as-you-go,” electricity plan.

With a prepaid plan, the customer pays in advance for a set amount of electricity. The good news is that the customer is able to track their electricity usage online and can reload the account when it runs low. However, rates are not fixed in a prepaid plan, so it can be harder to plan out expenses.

Green Energy Plans

Green energy plans are those that supply electricity from renewable energy sources. That’s going to be primarily 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.⁹

Most green energy REPs will still offer variable- and fixed-rate plan options; the main difference is where their energy comes from.

Business Energy Plans

If you’re looking for a supplier for your business, keep in mind that not all REPs will provide commercial electricity. So you’ll need to search for the ones that do. Business energy plans may also be needed for industrial properties, schools, government buildings and churches.

Most business energy suppliers will offer variable or fixed-rate options.

Need more information to help your decision-making? You can use this tool or click below to be connected with local energy providers near you.

Best National Company

5/5

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Nationwide Service

Best Rates

4.5/5

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Statewide Service

Best Plan Variety

4/5

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Electricity Companies and Providers in Texas

As mentioned, there are well over 150 energy providers in Texas. EcoWatch has chosen to focus on REPs that get their basic power from a clean energy source, like solar or wind power.

Here are a few examples of the best energy companies in Texas and what makes them top suppliers by our standards.

Gexa Energy

• Texas’ best value energy plan, offering cheaper electric rates relative to most competitors
• Offers 100% renewable options
• Fixed-rate plans
• Wide variety of contract term options
• 20+ years of experience
• A+ BBB accredited business¹⁰

Best Rates

4.5/5

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Green Mountain Energy

• 100% renewable options
• Green-e verified plans
• Fixed-rate plans
• Variety of contract term options
• 20+ years of experience
• Low complaint rate
• A+ BBB accredited business¹¹

Best Green Energy Options

4.5/5

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Nationwide Service*

Constellation

• Award-winning company, one of the best in the business
• Offers 100% renewable energy options
• Options for customers to go solar via Sunrun with guaranteed prices
• Veteran solar energy supplier
• The No.1 producer of carbon-free energy in the U.S. (producing 10% of all carbon-free energy)
• 20+ years of experience
• A+ BBB accredited business¹²

Best National Company

5/5

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Reliant Energy

• Award-winning company
• One of the most prominent companies on the market
• Offers a 100% renewable energy option, although most of its plans are not green
• Fixed-rate plans
• Wide variety of plan options
• 20+ years of experience¹³

Best Plan Variety

4/5

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Rhythm

• Offers 100% renewable energy
• Majority of customer reviews are positive
• Promotes transparency, promises not to charge any hidden fees
• 90-day free trial
• Up to $150 in bill credits to cover switching fee from old provider
• Note: Very young company, just launched in 2020¹⁴

Best Up-And-Coming Company

4/5

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What to Look For When Choosing an Electricity Provider

Whether you’ve just moved to Texas or you’re looking to save money by switching companies, here are five main things you should look out for when choosing an electricity provider:

1. The type of plans it offers: Not every REP will offer fixed-rate, variable and no-deposit energy plans.
2. Where the energy is coming from: We recommend companies that offer 100% renewable plans from solar or wind energy. If a company does not specify where its electricity comes from, it’s likely natural gas.
3. Its electricity rates — and the fine print: Many customers shopping for a new energy provider will be looking for the cheapest electricity rates, but if the prices look too good to be true, be sure to read the fine print. Some companies will offer low rates for short-term contracts with a fine-print clause that it will turn into a variable or higher rate when the contract expires. Be wary of this, as companies with misleading advertising may not have your best interests in mind.
4. Company history: In most cases, you’ll want to choose an energy supplier with a proven track record of quality service in your area. You also may want to do some research to find out if there’s a parent company.
5. Customer reviews: No one enjoys having to pay for electricity service, but an excessive number of negative customer reviews is probably a warning sign to steer clear of a company. On the other hand, tons of positive reviews are telling that a company is likely honest and accommodating.

Other Popular Providers in Texas

EcoWatch has chosen to feature providers that align with our mission of offering 100% renewable energy in most cases. Here are some of the other popular electricity providers in Texas that may not hit that goal:

^{*Rates are subject to change and will vary based on your TDU **All information is accurate as of March 2022}