En Español (866) 963-9353
PO Box 975428
Dallas, TX 75397-5428

Find the Best Electricity Rates in Texas: A Complete Guide

We're Here to Help

find best electricity rates in texas

Finding the right electricity plan in Texas can be overwhelming due to the many options available. At Payless Power, we’re here to simplify the process for you. This article will help you navigate the Texas electricity market, compare rates and plans, and make an informed decision to find an affordable plan that suits your needs, whether you’re in a big city or a small town.

Understanding the Texas Electricity Market

Texas stands out in the U.S. for its unique approach to electricity: it has a deregulated energy market. That means you have the freedom to choose your electricity provider, much like you choose your phone company. This deregulation also fosters competition among providers, which can lead to better rates and services for consumers.

Two key players in this market are the Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT). The PUCT oversees the state’s electricity industry, ensuring that customers are treated fairly and that the market runs smoothly. ERCOT, on the other hand, handles the grid that distributes electricity across most of Texas, managing the flow of electric power to more than 26 million Texans.

Then, there are Retail Electricity Providers (REPs). These are the energy companies that sell electricity plans to consumers. REPs purchase wholesale electricity from generators and sell it to you, the customer. They set the prices, offer various plans, and manage customer service. Your job is to choose a REP that offers the best combination of price, plan features, and customer service.

Types of Electricity Plans in Texas

Texas’s deregulated market means a variety of electricity plans are available to you. Let’s break them down:

  • Fixed-rate plans. These plans lock in your electricity rate for the duration of your contract, which can range from a few months to several years. The benefit is price stability, as your rate won’t change with market fluctuations. The downside is that if market rates fall, you won’t benefit from the lower prices until your contract ends.
  • Variable-rate plans. Unlike fixed-rate plans, these plans change based on market conditions. This could mean lower bills when electricity prices drop, but higher costs when they increase. It’s a plan that requires a bit of risk tolerance and close attention to market trends.
  • Time-of-use plans. These plans charge different rates depending on the time of day and week. Electricity might be cheaper during off-peak hours, making this plan a good fit if you’re flexible with when you use your energy.
  • Green energy plans. For those interested in reducing their environmental impact, these plans source electricity from renewable resources like wind and solar. While they can be slightly more expensive, they’re a great way to support sustainable energy.
  • Prepaid and no-deposit plans. Ideal for those who prefer to pay for electricity as they use it or who may not want to undergo a credit check. These plans allow you to purchase electricity before you use it, offering flexibility and control over your energy budget.

Understanding these plans is the first step in finding the one that’s right for you. Think about your energy needs and preferences, and you’ll be well on your way to choosing a plan that fits.

Factors Influencing Texas Electricity Rates

A handful of factors determine Texas electricity rates. Understanding these can help you make more informed decisions about your electricity plan.

  • Energy sources. The type of energy source used to generate electricity significantly impacts rates. Natural gas and renewable energy sources like wind and solar are common in Texas. The costs to produce electricity from these sources can vary, affecting the rates REPs charge. Renewable energy plans, while beneficial for the environment, can sometimes be more expensive due to the technology and infrastructure required.
  • Location. Where you live in Texas can also influence your electricity rates. Urban areas like Houston and Dallas might have different rates compared to rural areas, mainly due to the differing costs of supplying electricity to these regions.
  • Kilowatt-hours (kWh) used. Your electricity bill is typically calculated based on how many kilowatt-hours (kWh) you use. One kWh equals the amount of energy you would use by keeping a 1,000-watt appliance running for one hour. The more kWh you use, the higher your monthly electricity bill. Understanding this can help you manage your energy consumption more effectively.
  • Seasonal variations and trends. Texas experiences significant seasonal variations in energy usage. Summers can be scorching, leading to increased air conditioning use, while winters might require more heating. These seasonal demands can affect electricity rates, as higher demand often leads to higher prices.

What Is the Average Electricity Rate in Texas?

As of February 2024, the average electricity rate in Texas was around 14.61 cents per kilowatt-hour, according to the U.S. Energy Information Administration (EIA). However, rates can vary based on the factors we’ve discussed above. This average gives you a baseline, but your specific rate will depend on your location, energy plan, and how much electricity you use.

While the average rate above is a useful reference, you should find a plan that suits your specific needs, whether that’s a lower rate, renewable energy, or flexible payment options. We’re here to help you navigate these choices and find a plan that aligns with your energy goals and budget.

How To Compare Electricity Plans

Choosing the right electricity plan is key to managing your energy costs. Here’s what to look for when comparing plans:

  • Electricity facts label (EFL). Think of the EFL as a nutrition label for your electricity plan. It provides crucial information like the price per kilowatt-hour, contract terms, and any additional fees. Always read the EFL carefully to understand what you’re signing up for.
  • Contract length. Plans can range from month-to-month to several years. Longer contracts might offer rate stability, while shorter ones provide more flexibility. Consider how long you’re comfortable committing to a plan.
  • Energy rates and incentives. Compare different plans’ energy rates. Some plans might offer lower rates or incentives like bill credits, which can reduce your overall costs. Understand the conditions of these incentives and know your average energy usage, as this will determine which plan is most cost-effective for you.
  • Early termination fees. Life is unpredictable, and sometimes you need to switch plans. Be aware of any early termination fees that could apply if you decide to switch before your contract ends.
  • Customer service and reliability. Don’t overlook the importance of customer service. A provider that offers reliable support can be a lifesaver if you encounter issues with your electricity service.

Tips for Lowering Your Electricity Bill

Looking to reduce your energy bill? Here are some strategies:

  • Reduce your energy consumption. Turning off lights when not in use, using energy-efficient appliances, and adjusting your thermostat can make a noticeable difference in your energy consumption.
  • Check for bill credits and incentives. Some plans offer bill credits for using energy during off-peak hours or for reducing your usage. These incentives can lower your overall bill.
  • Explore special plan features. Keep an eye out for plans offering features like free nights or weekends. These plans can be great if you can shift your high-energy use to those times.

By understanding these factors and tips, you can make a more informed decision about your electricity plan and find ways to save on your bill. The right plan for you balances affordability with your specific energy needs and preferences.

Choosing the Best Texas Electricity Plan

To find the most suitable electricity plan in Texas, it’s essential to assess your unique requirements. Here are key considerations to guide your decision:

  • Identify your plan type: Residential vs. commercial electricity. First, determine whether you need a residential or commercial plan. Residential plans are for homes, while commercial plans cater to businesses and may offer different rates and terms.
  • Benefits of deregulation. Deregulation in Texas means more choices and potentially lower rates. With various energy providers competing for your business, you have the power to choose a plan that best fits your lifestyle and budget.
  • Navigating the market. Effectively navigating the electricity market involves comparing plans, understanding contract terms, and considering your energy usage. Don’t hesitate to ask providers questions or seek clarifications.

Get the Best Electricity Rate with Payless Power

Payless Power offers a blend of competitive rates, customer-friendly services, and unique plan features so you can find the electricity plan that’s right for you.

  • Unique features. One standout aspect of Payless Power’s offerings is our no-deposit, prepaid plans. These plans provide the flexibility to pay for electricity as you use it, without requiring a hefty upfront deposit.
  • Commitment to competitive rates and service. At Payless Power, our commitment extends beyond just providing electricity. We strive to offer rates that are competitive and fair, coupled with top-notch customer service. Our goal is to ensure you’re not just satisfied but delighted with your electricity plan.
  • Tailored for Texans. Our plans are designed with Texans in mind, taking into account the unique energy needs and preferences of residents across the state. Whether you’re in a bustling city or a quiet town, we have a plan for your service area that fits your lifestyle.

Ready to find your perfect electricity plan? Explore our plans and start your journey to better energy management today. With Payless Power, you’re not just choosing an electricity provider; you’re choosing a partner committed to meeting your energy needs.

Texas Electricity Rates FAQs

Before we wrap up, let’s address some frequently asked questions that you might have about electricity rates and providers in Texas.

What is a Good Rate per kWh in Texas?

A good rate per kWh (kilowatt-hour) in Texas can vary depending on several factors like your location and the current market conditions. Generally, rates below the state average, which hovers around 11.86 cents per kWh, are considered good. However, it’s important to factor in other elements of your plan, such as contract terms and any additional fees.

Who Is the Cheapest Electric Provider in Texas?

Identifying the cheapest electric provider in Texas isn’t straightforward as rates fluctuate and vary by location. Companies like TXU Energy, Payless Power, and others offer competitive rates, but the “cheapest” can depend on your specific needs and energy usage. It’s recommended to compare rates and plans from various electric companies and utility companies to find the best deal.

How Do I Find the Lowest Electricity Rates in Texas?

To find the lowest electricity rates in Texas, start by comparing plans from different Texas electricity companies. Look at the EFL for details on rates, fees, and terms. Keep in mind that during times of higher rates, such as peak summer months, rates may be higher across the board.

Also, consider contacting your Transmission and Distribution Utility (TDU), like Oncor or CenterPoint Energy, during a power outage or for specific concerns about your service area.

What our customers are saying

See why our power customers say we're the best electricity provider in Texas!

Affordable and easy to make payments

I was worried about getting electricity for my home through a prepaid company. I was calling around to see different rates then going through all the hassle of credit checks while dropping points each…

Christine M. in Killeen

Happy Customer

I have been with this company for several years and have been very happy since. Even when I moved, they made my usually stressful situation very easy and carefree. I recommend them to everyone that I…

Julia L. in Webster

Long term customer

I have enjoyed the service for 2 years now. In the beginning this service was planned to be temporary but with the service being so effective for me i decided to keep it for the long haul. I’m a happy customer.

Kalandra H. in McKinney