Compare the Best Texas Electricity Providers and Rates
How to Use Our Texas Electricity Rates Table
This table will show you the best Texas electricity rates from different providers, based on your usage. Understanding your usage is a key element to getting a great rate. If you don't know your usage a simple calculation for Texas is 100kWh for every 100sq ft. So a 1000 square foot apartment should use 1000 kWh. Or a 2500 sq ft house comes out to 2500 kWh/ month.
How Electricity Rates Work
In Texas, there are Electricity Generating Companies, (Luminant as an example) Electricity Distribution Companies (like Centerpoint and Oncor) and Electricity Retailers (REPS). Retailers buy electricity on the wholesale market and sell it to you. The distribution companies maintain the poles and wires, and turn off service and turn it on when directed by the retailer. Electricity rates are driven by the cost of natural gas, seasonal weather and expected usage. We've been in this business for over 20 years and we can tell you this. Texas weather is crazy. hurricanes in the Gulf, hail and tornadoes in North Texas and just plain hot weather all summer. For this reason we always recommend a fixed rate when shopping for electricity in Texas why should you shoulder the risk of a hot summer or a cold winter. Locking in a fixed rate eliminates the risks of changes in the natural gas market and weather risk which can spike variable rates by as much as 50%.
Fixed Rate Electricity Plans
Fixed rate plans in Texas lock in a rate for a term or period of time ranging from 3 months to 5 years. The most popular terms are 6, 12, 18 and 24 months. They are best for shoppers looking for stable rates, and long term price protection. The greatest risk of a fixed term contract is that rates go down significantly during your term. In these cases it’s best to do an analysis of paying the early termination fee ($100-$200) if rates have fallen to the level where paying the fee makes sense.
Variable Rate Plans
Variable rates are best for customers who need flexibility, or are between contracts. Your monthly bill will change and vary with the fluctuations of the electricity market. If it’s a hot Summer you will have high bills, if it’s a colder than average winter you will have high bills. And the opposite if we have a cool summer or mild winter. It’s risky and we only recommend using them between contracts for 1 month periods max.
Pre-Paid plans are great for those who have weak, no credit, or are just getting started. The rates paid will be a few cents higher than traditional fixed rate post pay plans. However, prepaid providers have made the process extremely easy, with phone apps and texts that tell you to refill your account. Some provide bridges to post pay plans if you maintain on time payments.
Green Energy Plans
Green energy plans are a great way to support green energy generation. You will pay a premium for green energy, because you are paying for traditional electricity generation PLUS a subsidy for green energy. Your energy will be provided by the nearest generation source. However, you will offset the “dirty” generation usage with green energy RECs (Renewable Energy Credits which cost you 2-3 cents per kWh
When is the best time to switch?
The best time to switch depends on a few factors. If you're in a contract electricity prices have decreased by 20-30% - then you need to determine if you'll save more than the early termination fee. Usually you'll have to be a large user ( 3000kWh +/ month) for this to make sense. Otherwise the best time to switch is between peak seasons, for example, in fall and spring as that's when pricing tends to be at the best point.
OK! Cut to the chase! Who has the best electricity rate in Texas ?
So, upfront. The cheapest rate is probably not the best rate. Cheap rates may require specific usage "tiers" or may have "Gotcha's" that may increase your rate by 10-50% . We've built tools to help you figure out which is best. So we recommend looking at the average bill. We've done the analysis and provide usage "curves" (industry lingo) that factors in weather and how your rate could be effected. Check out the recommended tab (above) to view the plans that provide the best value.