Avoid Hidden Pass-Through Charges for Electricity in Texas

Texans often open their electricity bill and find fees that don’t match their actual usage. These may be because of pass-through charges for electricity, like costs from the local Transmission and Distribution Utility (TDU) for maintaining poles, lines, and meters.

Even though your local retail electric provider (REP) handles the billing, TDU delivery charges get passed straight through to you. They can change from month to month, which makes them feel like hidden fees.

It’s no surprise that many customers in Texas feel frustrated by unpredictable delivery charges buried in long statements. The good news is, you don’t have to be caught off guard. Prepaid electricity plans give you clear pricing with no hidden add-ons, making it easier to see exactly what you’re paying for.

By learning how TDU delivery charges work and exploring alternative energy plans through your REP, you can stop feeling blindsided by your electricity bill. Instead, you’ll have more control over your costs and better tools to keep them manageable.

What Are Pass-Through Charges?

Pass-through charges are fees from your TDU for delivering electricity to your home or business. Even though you pay your retail electric provider, these costs go straight to the TDU. They cover the infrastructure that keeps your power on—like poles, wires, and meters—and are separate from the actual cost of electricity.

Before a full explanation, here are a few key terms to know:

• Public Utility Commission of Texas (PUCT). Regulates electricity markets in Texas and sets TDU rates.
• Transmission and Distribution Utility (TDU). Also called a TDSP (Transmission and Distribution Service Provider), this company delivers power to your home.
• Kilowatt-hour (kWh). A standard unit of energy used to measure usage and calculate charges.
• TDU delivery charges. Fees billed by a TDU for delivering electricity, which your REP passes directly to you.

On your electricity bill, you’ll usually see TDU delivery charges listed as separate line items for things like distribution and transmission. These charges depend on your kWh usage and the rates set by your local TDU, which PUCT approves and regulates.

According to PUCT, your REP does not mark up these fees. TDUs only pass along the actual costs of maintaining the poles, wires, and meters that deliver power to your home.

Why Do Pass-Through Charges Vary?

Pass-through charges vary depending on several factors, including your TDU rates, where you live, and your household’s energy usage.

For example, Houston customers under CenterPoint Energy may pay different delivery costs than those in Dallas served by Oncor or in rural areas covered by AEP Texas North. Even within the same state, these differences can add up on your utility company bill and affect overall energy costs.

Changes in the energy market also play a role. Rising natural gas prices, along with the expense of maintaining poles, transformers, and meters, all influence TDU rates. It’s important to remember that these are delivery charges, not the cost of electricity itself. Your service provider sets the supply rate, while the TDU bills for the cost of delivering it to your home.

PUCT notes that TDU rates are carefully regulated to ensure utilities do not profit from them. The fees simply cover the pass-through costs of operating and maintaining the grid across Texas.

Prepaid Electricity Plans: A Way To Avoid Surprise Fees

Texans who are frustrated with unpredictable bills may find prepaid electricity to be a practical alternative to traditional postpaid electricity plans. Instead of waiting for a monthly bill, you load funds to your account in advance and pay as you go while keeping track of your daily electricity usage.

With Payless Power’s pay-as-you-go electricity plans, there is no deposit, no credit check, and no need to wait for the billing cycle to close. Customers receive daily updates by text or email, which makes it easier to adjust their habits and manage their budget. Prepaid customers also avoid hidden pass-through charges, since TDU delivery costs are included in the upfront pricing rather than showing up later as separate line items.

Here’s a quick comparison of how postpaid and prepaid electricity plans differ from a Texas REP or service provider:

By switching to prepaid electricity, Texans gain more control over energy plans, clear visibility into costs, and the peace of mind that comes with avoiding surprise charges.

How Pass-Through Charges Affect Texans

For many residential customers in Texas, the electricity bill can feel unpredictable. One month the utility bill looks normal, and the next it jumps—not because of higher energy usage, but because of shifting TDU pass-through charges.

These charges come directly from the utility and are simply passed along, so customers may see fluctuations whether they live in a Texas-New Mexico Power (TNMP) service area or elsewhere in the state.

This uncertainty makes it hard for households to plan. Some rely on credit cards to keep the power on, while others cut back on basic needs to cover surprise delivery fees. Even people with high-energy-efficiency homes get frustrated when their bill jumps without warning.

Prepaid electricity plans help solve this problem by including all costs in one daily update. Customers know exactly what they’re paying, can track usage in real time, and make adjustments to secure lower rates over time. This transparency gives residential customers more control over their monthly charges and reduces the stress of surprise fees.

Get Transparent Pricing Today

You don’t have to put up with hidden fees or unpredictable delivery charges. With prepaid electricity from Payless Power, you get upfront pricing, daily usage updates, and clear communication, so your Texas electricity bill is always easy to understand.

Payless Power offers plans with no deposit, giving you control over your costs and the confidence to budget without surprises. Ready to take the hassle out of managing your energy? Sign up for prepaid electricity with Payless Power today and experience the benefits of simple, straightforward pricing.

FAQs for Pass-Through Electricity Charges in Texas

Many Texans are caught off guard by the extra charges on their electricity bills. TDU delivery charges and other line items are among the most common questions customers ask about. Below, we break down these fees and explain what they actually mean for your household.

What Are TDU Delivery Charges?

TDU delivery charges are fees from your transmission and distribution utility that cover the cost of getting electricity to your home. These charges include maintaining poles and wires, reading meters, and handling transmission costs to keep the electricity grid reliable. Each utility company, such as Oncor Electric Delivery, CenterPoint, or Lubbock Power & Light (LP&L), has its own delivery rates, which are regulated by the state. You can find the official breakdown of TDU delivery charges on the PUCT website.

Do All Providers Charge Pass-Through Fees?

Yes. Almost every service provider in Texas is required to include these regulated pass-through fees since they go straight to the TDU. Some energy plans list them as separate line items, while others bundle them into the monthly charge. The fees are always part of your bill—the only difference is whether your REP makes them clear or buries them in the total.

Why Are Energy and Delivery Charges Different on My Electric Bill?

Your electricity bill usually has two main parts:

• Energy charges. These fees cover the actual power you use
• Delivery charges. These costs pay for electricity transmission and electrical grid upkeep.

In some cases, a retail electric provider or service provider may include a markup or add a variable charge to the supply rate, which makes it harder to predict your total costs. Customers with providers like AEP Texas Central often see this split on their bills. Prepaid electricity plans make it easier by rolling everything into one clear rate, so you know exactly what you’re paying without surprises.

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