For many Texans, short-term electricity plans sound appealing because they offer flexibility. A three- or six-month contract gives you room to test the market, adjust to seasonal rate changes, or avoid being locked into a long commitment. But that flexibility can come with trade-offs.
Short-term plans often renew during high-demand months or include higher rates once the term ends. Before choosing one, it’s important to understand how these contracts work, what to watch out for, and whether the convenience really outweighs the cost.
Three- and six-month electricity plans are short-term contracts offered by retail electric providers (REPs) in Texas. Unless advertised otherwise, they are usually fixed-rate electricity plans. They attract consumers who want flexibility or hope to take advantage of lower “shoulder season” electricity rates in the spring and fall. Because the terms are shorter, they’re often chosen by renters, people in transition, or anyone wanting to test the market before committing long-term. However, short-term contracts come with added risk. They may renew during high-demand months when prices surge, or expose you to higher rates if the market shifts before your next renewal period.
Short-term electricity plans last less than a year, typically 3 or 6 months, and are designed for consumers who prefer flexibility over long-term stability. These plans are usually fixed-rate contracts, meaning your price per kilowatt-hour (kWh) stays the same for the duration of the term.
Once the contract expires, you’ll need to either renew or shop for a new plan. This structure can work well in certain situations, but timing matters. If your plan ends during Texas’s peak summer or winter months, you could face much higher renewal rates when you shop again.
Another option for short-term electricity is a variable-rate/price plan, also called a month-to-month plan. They are not the same as 3-6 month contracts, because their kWh rates can change monthly depending on market conditions and other factors. Variable-rate plans are usually only helpful in specific situations, like real estate agents or contractors who need power for home showings, because they lead to unpredictable bills.
Many Texans choose 3- or 6-month electricity plans for the flexibility they provide. Short contracts make it easier to align your plan with lower seasonal rates or switch providers without a long-term commitment.
Some consumers use these plans as a way to test a new REP before signing a longer contract. Keep in mind that short-term plans are best used as strategic tools rather than permanent solutions.
Short-term plans may seem convenient, but they come with added risks. You’ll need to shop for a new plan more often, or get automatically rolled into a variable-rate plan if you forget to renew. Timing is another major factor; if your plan expires in the summer or winter, you may face much higher renewal prices.
For example, a 6-month plan signed in November would expire in May, right before summer rates typically spike, wiping out any savings you gained earlier in the year.
| Plan Type | Duration | Pros | Cons | Best For |
|---|---|---|---|---|
| 3-Month | Short | High flexibility; best for seasonal savings | Requires frequent renewal; may renew during peak pricing | Renters, short stays, timing a cheaper rate during fall or spring |
| 6-Month | Moderate | Good balance of flexibility and price control | Still frequent renewals; limited stability | Renters, builders, moderate-length stays |
| 12+ Month | Long | Stable rates; less monitoring needed | Less flexibility; harder to “time” renewals | Homeowners, long-term residents |
While short-term electricity plans aren’t ideal for everyone, there are situations where they can work to your advantage. These contracts can offer strategic savings if you know how to time them right. A short-term electricity plan may be a smart choice if:
Timing is everything. Locking in a short-term plan in April or October can help you avoid paying higher prices when prices surge in summer or winter.
The potential savings from a short-term electricity plan depend on several factors, including your usage, the timing of your switch, and the rate difference between plans.
Texans who actively compare offers—especially during low-demand seasons like spring and fall—can often lock in lower per-kWh rates that lead to noticeable monthly savings.
To see what you could save, start by comparing your current electricity rate with short-term plan offers available in your area.
| Plan Type | Rate per kWh | Avg. Monthly Usage (kWh) | Est. Monthly Cost | Savings per Month |
|---|---|---|---|---|
| Current Plan | $0.1555 | 1,146 | $177.63 | — |
| New 3-Month Plan | $0.10 | 1,146 | $114.60 | $63.03 |
Everyone loves a good savings opportunity, but remember that your actual savings depend on:
Short-term electricity plans can be a smart move if flexibility is your top priority. They work well for renters, people planning a move, or anyone comfortable keeping an eye on the market. If you can time your contract to start and end during lower-demand seasons, you may be able to capture short bursts of savings. But if you prefer predictable pricing and fewer renewals, a longer contract will likely serve you better over time.
Before you decide, take a few minutes to explore current options and see how different electricity plans stack up. Enter your ZIP code into Power Wizard’s comparison tool to view live Texas electricity plans, filter by what matters most to you, and see the true cost of each plan upfront.
Short-term plans can make sense for specific situations:
For most households, however, long-term plans (12+ months) provide better stability and lower average costs.
Possibly, but savings depend on your timing and market conditions.
Example: If you switch from a 15.5¢/kWh plan to a 10¢/kWh short-term plan, you could save roughly $60 per month for a home using about 1,100 kWh. However, if your new plan expires during a peak season, renewal rates may erase those savings.
Choose a short-term plan if you prioritize flexibility or need a stopgap before a move. Choose a long-term plan if you want price stability and fewer trips to the store.
As a rule of thumb:
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