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Blog Oct 5, 2021

Reading Your Texas Electricity Facts Label

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Why Your Electricity Facts Label Is Important

Are you considering switching power companies due to a great electricity rate you saw advertised? Stop and do your homework first. Many advertised rates are based on specific electricity usage levels and other factors. Depending on your current consumption, you may pay far more than what you see in the advertisement. Knowing how much you use and learning to read the Texas Electricity Facts Label (EFL) can help you see if you truly are getting a good deal and avoid unwanted surprises.

The advertised rate of cost per kWh hours also does not completely reflect the entire cost of electricity for the customer. So the electricity facts label provides customers needed transparency on cost-impacting factors such as applicable zip code, rate based on usage amount, recurring charges, fees, and more. Knowledge is power, and your EFL provides details so you know exactly what you’re paying for and how to shop for the best plan.

In Texas, every utility customer receives an EFL with their first electricity bill from their private Retail Electricity Provider (REP), or you can receive an EFL upon request for comparison when shopping for plans. As a deregulated state since 2002, Texas offers dozens of power company choices, which can lower costs but makes comparison difficult. As a result, the Public Utility Commission of Texas (PUC) requires the electricity companies to provide an EFL for each plan they offer.

 

How to Read a Texas EFL

While you don’t need a degree in electrical engineering to decode your EFL, we’ll help you navigate the sometimes-confusing terms so you can calculate the best rates and plan for your household. Whether you have a prepaid, no-deposit plan or a traditional post-pay electric plan, every Texas EFL outlines three major sections. 

  1. Electricity Price – For prepaid plans, the average price is based on the amount of kilowatt-hours (kWh) used plus other base charges set by the provider and delivery charges set by the Transmission/Distribution Service Provider (TDSP – aka the “wire and pole” company that delivers the power to you via telephone poles, transformers, and high voltage lines). The TDSP charges are set by your local utility and are the same across every electricity provider servicing that area.
  2. Rate Calculation – Beyond the advertised rate per kWh, knowing the actual costs takes some calculating to understand the standard charges and thresholds of crossing into another rate per REP plan.
  3. Disclosure Chart (with Contract Terms, Fees, etc) – Here, you’ll find details of the plan, including the type of product (variable rate or fixed, prepaid or postpaid), length of contract (month-to-month, 12 months, up to 36 months), termination fees, and more.

Depending on your provider, the EFL format will vary, but each one provides key information in these standard areas. Your Payless Power EFL will look like this.

  1. Electricity Price — A breakdown of important components to determining your price, including set charges and a sliding rate scale based on kWh usage.
  2. Electricity Price Table — The average expected price based on your kWh usage (at 500, 1000 or 2000 kWh).
  3. Price Disclosure Charges —  This breaks down what components are base charges (daily and energy charges, plus local TDSP charges) that factor into your average price per kWh. 
  4. Fees — Different plans may require termination fees or other non-recurring fees (at a set rate), such as reconnection (outlined in each plan’s terms of service, not the EFL).

 

How to Calculate Your EFL

  1. Look at previous electric bills to determine your average monthly usage in kilowatt-hours.
  2. Determine your rate per kWh based on the chart on the EFL.
  3. Take your rate times your average monthly kWh usage. (eg 12¢x 2000 = $240) This rate can fluctuate each month based on your kWh usage if you cross over the next threshold.
  4. To estimate monthly costs, use the following equation (based on the Payless Power rate/usage example above):
Daily charge (or base charge)
$2.67 x 30 days
$80.10
+TDSP monthly charge  $3.42
+Monthly kWh cost
(eg 12 x 2000 kWh)
$240
Total estimated monthly cost $323.52

Shopping for a Prepaid Plan

In order to compare apples to apples, you need to know your average monthly usage from previous electricity bills. Then you can reasonably estimate your future usage or increase your estimate depending on if you are moving to a bigger home with more rooms, additional people, more power needs, etc. You can shop and compare plans at Compare Power.

Understanding the EFL helps you determine your estimated total cost based on your electricity usage. While researching Texas prepaid electricity companies, other considerations in addition to cost include:

-Availability in your area 

-Fixed or variable rate plans

-Month-to-month plans with no termination fee or a set contract term with rate lock

-The minimum cost for connection (which goes toward the payment of electricity)

-Reliability and proven customer service

 

Payless Power: The Best in Prepaid Electricity

Payless Power has provided Texans with reliable, competitive prepaid electricity since 2005. We offer no deposit, no credit check plans to suit your budget and your lifestyle. Our excellent customer care includes Saturday hours and same-day connection.

You will receive a daily alert detailing the quantity of kilowatt hours your home consumed, your current energy account balance, and the approximate number of days before a payment is necessary. You can adjust your usage or add to your balance accordingly — keep a positive balance and the power remains on. A recent feature customers love is the Auto Pay option; if selected, an amount determined by the customer is added automatically to the account balance any time the balance gets low. You can still monitor your usage in real time, but it’s a hassle-free way to provide peace of mind and stay on top of expenses.

To search Payless Power’s no-deposit, prepaid lights and electricity in your area, simply enter your zip code to explore your options. Once you decide on a plan and create an online account, you can have electricity connected the same day (during business hours)! Call our Customer Care team at (866) 963-9353 if you need assistance.

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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…

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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.

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