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Texas Energy Providers: Picking the Best One For You

texas energy company reviews

Living in a deregulated state lets you enjoy certain advantages when it comes to electricity. The most notable one is the option to choose your electric company. Deregulation allows the power providers to set their electricity rates and services. As such, you can pick the one that matches your needs and budget. 

Although not all Texans enjoy this privilege, most residents in the Lone Star State do. That means they get to select their electricity provider from among several that offer varying rates and services. If you live in a deregulated section of the state, you have the power to lower your electricity bill without necessarily limiting your energy usage. The secret lies in deciding which electricity company to work with and what energy plan to opt for. 

Choosing an Electric Company in Texas

Over 125 energy companies exist in Texas. With such a wide range of choices, finding the cheapest rate and the best electricity plan can be tricky. After all, you don’t just want to save money, but you’ll also want a reliable power provider to work with. To find the best energy company and energy plan, here are some factors you have to consider. 

Identify Your Home Energy Usage 

Your electric bill will depend on your power consumption. When you understand how much energy you use, you’ll have a clearer idea of what to look for when switching providers. Review how much electricity you’ve been using to know what plan will best answer your needs. 

Retail electricity providers formulate each plan’s rate for a specific range of power usage. If you know your typical consumption, you can pick the plan that gives you the most bang for your buck. 

Examine Your Electrical Needs and Budget 

In the deregulated Texas energy market, energy companies abound. These retail energy providers offer a selection of electricity plans with contracts ranging from one month to three years. So before shopping for an energy provider, consider the following. 

  • If you rent or have plans of moving soon: Going for a long-term fixed-rate plan won’t be a wise move if you intend to relocate within a few months. Instead, a three or six-month power plan might be a better fit for your situation. 
  • The size of your home: Some fixed-rate energy agreements offer lower rates for 12 and 24 months contracts. That’s for consumers with high kWh usage per month. Larger homes typically use more electricity, so the size of your house matters. 
  • Mode of billing and payment: You may opt to prepay for your electricity. It’s a great alternative to a long-term agreement. Known as pay as you go plans, they’re fast gaining popularity. 

Research Different Rate Plans 

The rates of the various electricity plans vary. So the best option depends really on your requirements. As such, you need to review the details of each one. Take note of the electricity facts label (EFL). The EFL provides essential information regarding the electricity rates you’ll pay depending on various usage levels. Using the EFL lets you compare the rates of the different plans and how they’ll affect your electricity bill.  

Coming up with the best pricing hinges on your particular situation. For example, a lengthy fixed-rate agreement might be an excellent option if you’re a long-term homeowner. On the other hand, you may want to go for a variable rate plan if you intend to relocate shortly. 

Choose a Plan 

After doing your research, you’ll usually have a shortlist of retail electric providers to choose from. Before you take your pick, read the details of the contract carefully. Pay attention to the fine print to avoid falling prey to marketing ploys. A sneaky energy company may advertise per kWh rates that don’t incorporate all fees, including the utility delivery charges.  

Refer to the electricity facts label to compare the different energy plan rates comprehensively. The EFL also contains other important information regarding the electricity plans.  

What Is Power To Choose Texas? 

Power to choose is a state-run website that lists the rates of energy providers in deregulated areas of the Lone Star State. It’s the official electricity shopping site owned and run by the Public Utility Commission of Texas. 

Through the Power to Choose website, electric customers get to pick their own electricity provider using an apples-to-apples comparison of the offered plans. Having all the options listed on one site lets users quickly determine the pros and cons of each choice. 

To begin using the Power to Choose website, all you need to do is input your zip code. You can then start narrowing down your selection using the site’s filters. 

Energy Deregulation and the Power to Choose

Because of energy deregulation, many energy companies entered the electricity market. These companies offer competitive rates and services to attract customers, allowing Texans to take their pick. 

The power to choose gives customers the freedom to tailor-fit the power plans they’ll get to save money on their utilities. With a website that shows the rates of top providers along with other pertinent details, users can look for the best energy rate and plan. 

How to Switch Electricity Companies in Texas?

power to choose texas energy

In most instances, switching to a different energy provider in Texas is quick and easy. You usually need to enter your zip code on a website, choose the provider that meets your requirements and sign up. Here are a few tips to make a seamless transition from your current provider to a new one. 

  • Check the status of your contract: If your current contract expires in 14 days or less, you can skip the early termination fees. 
  • Make sure you’re eligible: Not all of Texas is under a deregulated market. Make sure your area is. 
  • Take note of the renewal rate of your current provider: Some power retailers charge a higher renewal rate than what you’ll pay as a new customer. 
  • Do your research: Find out which of the numerous power providers offer the best energy plan based on your situation and usage. 
  • Sign up and confirm: After you’ve decided on the company you want to work with, sign up directly on their website. Have your social security number ready as most electric retail providers do a credit check on new customers. 

Texas Electricity Rates 

With over 85% of Texas enjoying deregulation in the energy market, residents can pick the company that offers the best electricity rate. The average price of electricity in the Lone Star State was 12.21 cents per kWh in September 2021. So how much you pay also depends on your provider. 

The best electric company is one that fits your needs and budget. Here are some of the top power retail providers in Texas, along with the rates they offer. 

CompanyPlan LengthRate
Frontier Utilities (Frontier Super Value 12)12 months$0.075 per kWh
Gexa Energy (Gexa Saver Deluxe 12)12 months$0.076 per kWh
Pulse Power (Texas Saver 12)12 months$0.076 per kWh
Pulse Power (Texas Saver 12)12 months$0.076 per kWh
New Power Texas (Power of Credit 12)12 months$0.076 per kWh
Just Energy (Power Plus 12)12 months$0.095 per kWh
Constellation (12 Month Flat Tier Product)12 months$0.105 per kWh
TXU Energy (Smart Edge 12)12 months$0.109 per kWh
TriEagle Energy (Real Deal 36)36 months$0.111 per kWh
Direct Energy (Live Brighter 36)36 months$0.128 per kWh
Reliant (Conservation Plan 24)24 months$0.129 per kWh
Green Mountain (Pollution Free e-Plus 24 Preferred)24 months$0.136 per kWh
Payless Power (Premier 12 - Prepaid Plan)12 months$0.159 per kWh

Texas Electric Companies

Deregulation leads to competition among various power providers, forcing them to give their customers the best rate possible. The proliferation of Texas electricity companies can make it challenging to keep track of the information related to each one. To help in your search for the best power company, here’s a list of the popular electric companies in the area. 

Energy CompanyContact Information
Gexa Energy8556398259
Direct Energy8553076922
4Change Energy8555506662
Green Mountain Energy8446346092
TriEagle8446813227
TXU Energy8772830650
Payless Power2145500844
Cirro Energy8006924776
Frontier Utilities18669268192
Reliant Energy2145500844
First Choice Power8889806898

Utility Companies vs. Energy Providers 

In a deregulated state, various entities provide electric power to consumers. This causes some confusion when it comes to terminologies. So we understand how some can’t tell the difference between utility companies and energy providers. Here’s how to make the distinction. 

A utility company provides energy, such as electricity or natural gas, to your home. They acquire that energy from the various suppliers and deliver it to your home via the gas and electric lines they maintain. When the power goes out, you call the utility company

On the other hand, an energy provider delivers the energy that gets to your home to the utility companies. Energy providers buy wholesale energy from the wholesale power market and then sell that energy to customers. 

The utility company typically chooses the energy provider to do business with. But if you live in a deregulated area, you can directly pick the power provider you want. 

Energy Plans 

The number of plans to choose from makes it a challenge to single out the one that will give you the most benefit. Let’s discuss some of the more common ones to give you an idea of what to look for.

Fixed-Rate Plans 

With a fixed-rate plan, you pay a set amount each month for a specified period or term. That’s regardless of the fluctuations in the energy market price. This plan type usually requires you to sign a contract that locks you in for a stipulated amount of time. Typical contract lengths last between 12-36 months.

Fixed-rate plans offer predictability and protect you from the effects of market variations. However, there’s also a downside due to the lock-in clause. If you decide to end the contract before it expires, you’ll usually have to pay an early termination fee. 

Variable-Rate Plans 

In contrast with fixed-rate plans where you pay a set amount per month, your bill varies from month to month with variable-rate plans. By how much? That depends on the price of electricity in the market. This means that you’ll get cheaper rates when demand is low but expect to pay more per kWh with spikes in demand. 

What’s great about this plan type is the absence of a lock-in period. As such, you have the freedom to switch to a different provider or plan at any time. If you like flexibility, variable-rate plans are for you. 

Prepaid Plans 

You usually need to put down a deposit or undergo a credit check when you sign up for an electricity plan. If paying a deposit or submitting to a credit check is not an option for you, you can consider going for a prepaid plan. Several power providers offer this type of plan, so you can still take your pick among several choices. 

With a prepaid plan, you’ll pay a specified amount at the start of the month for the electricity you’ll use. You then reload your account as your balance decreases. You don’t receive a monthly bill with this plan type. Instead, notifications in your mobile device or email let you know about your power consumption level and your remaining balance. 

Indexed Rates 

Like with a variable-rate plan, the electricity rate also goes up and down in an indexed rate plan. However, the per kWh price in this plan type is based on a publicly available index. A rise in index prices leads to higher rates, while lower index prices lead to cheaper per kWh rates. 

The various providers use a different formula for calculating the rates in an indexed plan. To ensure that you’ll get a good deal, read the agreement carefully and understand how the rates are computed before signing. 

Pay-As-You-Go

Similar to the prepaid plans, pay-as-you-go options don’t require a deposit, and you pay for your electricity in advance. This type of plan works for those who have prepayment meters or are willing to install one.

Consumers purchase power credits from the company’s authorized agents, and the method for buying depends on the energy company. Usual means include purchasing keys, tokens, prepaid power cards, and smart cards.  

Pay-as-you-go electricity plans let consumers monitor and finetune their usage, which can help save on energy costs. Meanwhile, the charges are almost the same as those on the billing method. During installation, the meter usually comes with preloaded credits to start off the consumer. 

No Deposit Options 

This type of plan is for those who are unable or unwilling to put down a deposit for their electricity service. A poor credit rating, for example, may make it impractical for you to opt for a plan that checks your credit score.  

With a no-deposit option plan, you open an account with a power supplier and then put a specified amount into it. The company will give you updates regarding your usage and alert you when you’re nearing your limit. This means you’ll need to top up to have continuous service. 

Renewable Energy Plans 

Texas has developed into a leader in the green energy field in recent years. The state leads the country in wind generation and is also one of the top producers of solar power. As such, you have a wide choice of electricity plans that come from renewable sources. 

Every energy plan in the state contains a mix of renewable energy. Some retail providers even offer plans that are 100% green. You can narrow down your selections among these companies if you aim to help the environment. 

Business Energy Plans 

Almost 3 million businesses in the deregulated areas of Texas can benefit from these plan types. Business energy plans are for commercial users who consume significantly higher electricity. These plans offer affordable power rates, competitive plans, and green energy options. 

Solar Energy in Texas 

Solar panels have mushroomed in rooftops across the Lone Star State. Seventeen large solar power facilities also operate in the area, making Texas one of the top producers of solar power in the U.S. With the boom in solar, many consumers who aim to reduce their carbon footprint are investing in solar panels for their electricity needs. 

A residential solar power system in Texas comes to around $14,820 or approximately $2.60 per watt. The size of the PV system varies depending on the household’s needs and the types of panels used. Getting quotes from different installers is one of the recommended ways to get the best deal. 

Going solar in Texas may be for you if you want to help the environment and save money. Not only does installing a solar system aid in reducing your electricity bill, incentive programs offered by the local governments and energy providers, and utilities can add to your savings. 

Texas Electric Grid and ERCOT 

The Electric Reliability Council of Texas or ERCOT takes charge of the flow of electricity to over 26 million residents of the state in 8 million locations. It also manages around 90% of the Texas electric grid.   

A board of directors governs this non-profit organization while the Public Utility Commission of Texas and the Texas Legislature supervise its operation. ERCOT members are composed of representatives from various stakeholders, which include the following: 

  • Consumers 
  • Generators 
  • Cooperative 
  • Retail electric providers (REPs) 
  • Electricity marketers 
  • Transmission and distribution providers  
  • Investor-owned power utilities 
  • Municipal electric utilities 

How to Avoid Expensive Electric Bills?

During a winter storm in February 2021, Texas residents bore the brunt of high power prices. Extreme weather conditions at that time pushed the electricity rates to $9 per kWh. That’s 75 times the average price of 12 cents per kWh. 

On the opposite end of the spectrum, summertime temperatures in the state can reach a scorching 120 degrees F. During the summer months, Texans need air conditioning for comfort and even safety. Continuously running the AC unit naturally leads to higher power usage. 

While you can’t control the weather, you can mitigate its impact on your utility bill. How? By picking the right energy plan and power provider. Extreme temperatures can lead to high electricity bills. That makes it essential to select the plan with the best electric rates. In doing so, you can see significant savings on your energy payments. 

FAQs

How can I lower my electric bill in Texas? 

There are several ways to slash your electricity bill. Installing a smart thermostat, insulating your home, and using renewable power sources are just some of them. If you live in Texas, one excellent means of reducing your electricity expenses is by carefully selecting your power provider and the plans they offer. 

What is the best time to switch energy providers? 

That really depends on when your current plan expires. But if you have an option, it’s best to lock in your rates during periods of low demand. This usually occurs when temperatures are on their moderate ends, such as during spring and fall. 

What electric company does not require a deposit? 

Several electric companies in Texas waive the deposit requirement. Examples of these are Rhythm Energy, Direct Energy, Frontier Utilities, First Choice Power, and Payless Power. By typing in your zip code, you can check through several websites if the provider you have in mind does not require a deposit. 

Should I switch electricity providers? 

It can be worth it to switch suppliers. With so many providers to choose from, you have a high chance of finding one that meets your requirements. However, before you make the leap, find out if you’ll have to pay an exit fee and how much it will be. If it’s more than the savings you’ll get by switching, consider postponing your plan. 

Conclusion 

Choosing the best electric company can be challenging. You’ll need to consider several factors and carefully review your options. Still, it’s worth considering if you’re not satisfied with the rates and services of your power provider or if you think you’ll get a better deal. 

Luckily, deregulation in Texas led to an influx of electric providers in the market. Competition is fierce, forcing these companies to find ways to entice potential customers and retain current ones. That can lead to lower rates and plans that give the most bang for your buck. 

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