How to Shop for Electricity in Texas

Does shopping for electricity in Texas leave you feeling confused? You’re not alone. Due to deregulation in Texas, many citizens of the Lone Star State can choose their retail electricity provider (REP) themselves. But there are so many energy providers to choose from, not to mention fees and contracts to consider. So, where do you even begin with shopping for electricity?

The key is to break the process down into steps. It all starts with an evaluation of your current energy usage and plan. From there, you’ll have to do some research on providers before settling on the one that’ll work best for you and your home. It’s more complicated than just finding the cheapest energy company. Searching for “electric companies near me” or “electricity providers by zip code” is a good start, but you’ve got to dig to be sure of what you’re really getting into.

You’re not completely on your own, though. There are plenty of tools and resources available — like Power Wizard — to make the process as painless as possible. In fact, with your Power Wizard membership, you can complete all the steps of your electricity shopping with just a few clicks. However, we will also show you how to choose an electricity provider on your own in this article.

How to Shop for Electricity Rates in Texas: Your Texas Power Guide

You don’t deserve ever-rising energy bills or REPs that may be difficult to communicate with. You deserve the best deal from a company that works for you. The best electricity provider in Texas for you is going to be different for your home versus other homes, and shopping for electricity shouldn’t be as complicated as it is. Let’s look at how to shop for electricity in Texas.

How Electricity works in Texas

Texas is part of a deregulated market—which means you have a choice in which electricity provider you want to use. Some states have only regulated markets, which means there’s only one electricity provider you have to use. The benefit of having deregulated energy is that we can shop around for the best deal on the market.

Within the deregulated market, there are two types of plans: fixed or variable rate plans.  A fixed-rate means you’re charged a specific price per kilowatt hour that generally doesn’t change for the length of your contract. A variable rate means the price can change at any time. (We recommend fixed because it helps you avoid surprise bills.)

There’s a lot of competition in a deregulated market, which means that energy companies try to come up with the best prices and best deals to draw in more customers. But some of these deals may not be what they seem. There are plenty of gimmicky plans on the market that you will need to be careful to avoid. These include any plan that says “free”, which means an energy provider may be charging you with higher rates in the fine print but give you some “free” hours that may be cancelled out by the higher rate.

Use a service that finds the best plan for you

There are hundreds of electricity plans on the market and there’s a LOT that goes into finding the best plan for your home. It’s easiest to let a service do it for you—like us!

Power Wizard looks at your actual energy usage and compares it to plans on the market. Then, we find the plan with the best rate for your home. That’s the secret with the energy market—a low price up front doesn’t mean it’s the best.

For example, a plan may have a low rate, but it ends at the start of summer. This means you would have to choose a new plan when rates are statistically higher than any other time of year. This is a gimmick to get you on the highest prices for longer periods. Another example is when the plan appears to have a low rate, but that low rate may not apply to your home depending on how many kilowatts you use. There’s fine print to read, gimmicks to avoid, and we handle it all for you. We’ve done the research and we’ve seen it all when it comes to the electricity market. We know which plans are good and ones that may end in a shocking bill and buyer’s remorse.

We call our service TruPrice because we find the true price of the plan, not the gimmicky one upfront. At Power Wizard, we have thousands of members that trust us to find the best plan for them and we would love for you to be one of them. We’re on a mission to ensure that Texans don’t overpay for electricity. Get started today!

If you want to shop on your own – start here

Of course, you can do the shopping for an electricity plan on your own. You can find the best electricity plan for your home, but first you’ll need to gather up all the details for each plan you find. Look at the energy charge, the TDU charge, hidden fees, usage fees, etc. It’s a long list that we cover below.

Here’s an overview of what you’ll need to do when shopping for electricity on your own:

1. Shop around for the best price – use PowerToChoose or individual provider sites
2. Compare plans – gather all the details from each plan and compare
3. Be aware of gimmicks – the energy market is full of them
4. Keep track of your contract expiration date – don’t let your contract expire and roll to a high rate
5. Switch to a new provider at the end of a contract – New customers typically get the best deals

Hint: Power Wizard has done all this research and can point you to the best one for you in seconds.

1. Shop around for the best price

There are hundreds of plans to choose from. Don’t settle on the first one that seems appealing. Every electricity provider is competing for you, so they show you the best prices, even if those prices may not apply to your energy usage.

Plans are different per person and if your neighbor saves a lot of money on a certain plan, it may not work that way for you. You use energy differently than others, which means the best plan for you will be different too. You can look at every available provider here.

Psst, we’ve shopped around. We know the best plan for you. Just sign up and start saving.

So where do you start if you want to shop on your own? Read on.

PowerToChoose

PowerToChoose might be the most popular comparison site in Texas, and you can use it, but it may be easy to get trapped in a gimmicky plan. Hidden fees are everywhere, and you may not see them until a surprise bill comes.

Power Wizard gets paid only by our members. We look at plans available on the market, and we filter out gimmicky plans. Our members don’t overpay for electricity, which includes you when you join.

Individual Electricity Providers Websites

There are many individual electricity providers in Texas. It can be difficult to find them all, especially when new companies enter the market often. Luckily, the PUCT provides a list of all current electricity providers. You can find that here. Our tool scans available plans in seconds to find the right one for you.

Make sure you check out newly added electric providers because they will most likely have the best introductory rates because they need customers. Just make sure you read the fine print in detail. What do you need to find in the fine print? We’ve got a whole list for you below.

2. Start comparing plans

When you start looking at individual plans, there’s a list of criteria to research. Gathering these pieces is critical to avoid surprise bills. Hidden fees may be easily buried in the fine print, and sometimes even right under your nose. For example, the energy charge could appear low, and the TDU delivery fee may be confusing, but it may add .03 cents per kWh. Here’s all the data you’ll want to find for each plan.

What is your historical usage for the last year?

Find your historical usage for last year. You have access to your energy usage with Smart Meter Texas. Just create your account with your address and you can download your energy use per month. If you’ve lived in your home for at least a year, download the data for the last year to see what your usage has been for the entire year.

You can use this to determine how much you will spend per month. Just multiply how much the electric company charges per kWh by how many kWh you use. Ex. (.12c X 1,300 kWh)

What is the rate?

To find the true rate of the plan, you’ll need to look for 3 things.

1. Energy charge
2. TDU delivery charge
3. Other non-recurring charges – usage charges, fees, etc.

All of these can be found on the Electricity Facts Label (EFL), and every electricity plan has its own EFL. Look at every EFL to properly assess how much the plan will cost. To find the EFL, click on the plan you’re researching and there will be a link on the page.

What is the cancellation fee?

Electricity plans may have a cancellation fee, also called an early termination fee. It is a fee that is charged if you end the contract early. It will be listed in the Electricity Facts Label. Sometimes it’s $125-150. Other times, there may be a certain charge per month left on the contract. Check the EFL to see each plan’s cancellation fee.

You can avoid an ETF if you move out of your home before your contract ends by providing the necessary documentation to your supplier. If you cancel the plan for any other reason before the contract ends, you can be charged the ETF..

What fees do they have?

The most common fees are:

• Usage fees – Some electricity companies will charge you more if you use less than a certain amount of electricity. (Sounds like a gimmick because it is.)
• Cancellation fees – Charged for cancellation before the contract ends.
• Late fees – If you don’t pay your bill on time.

Some of these fees are found on the EFL, but others are found on the Terms of Service (TOS) document. Make sure you look over both.

Hint: Power Wizard has done all the math already. We keep you away from gimmicks and fees.

What is the term length?

This is how long the contract is active. Usually, there are 3-month, 6-month, 12-month, 24-month, or 36-month contracts. It can get tricky with the term lengths because electricity prices are historically higher in the summer months, which means you want to avoid a plan that ends in the summer.

A 3-month contract may look like the lowest price, but when it expires, you will need to sign up for a new plan. If your plan expires in the summer months, you may be paying the highest prices on the market.

Make sure to keep an eye on your term length and contract end date. If you don’t choose a new plan when your current plan expires, the electricity company may put you on a variable rate plan (I.e. shocking bills).

How many months of electricity do you want?

You should choose a plan based on the rate that is best for your home while keeping in mind how many months you need. A 3-month plan may work for you if you plan to move out in 3 months. But remember, you can cancel a plan with no early termination fee if you are moving out of your home.  So you can sign up for a 36-month plan, even if you’re planning to be in your home for only a year. Those longer-term plans may be cheaper, but make sure you dig into the details to be sure.

The bottom line is that you can sign up for a long plan and cancel when you move. But be careful with short-term plans that may look good but lead you to higher rates.

Psst, or just let us do it for you.

How do you schedule your renewal time frame?

“Renewal” is a term used in the electricity market, but you may not want to renew your contract with the same company. You could choose a new electricity plan with a new electricity company. Retail Energy Providers (REPs) may give the best deals to brand new customers. We recommend putting a reminder on your calendar each year about a week before your contract end date.

Again, be careful with plans that end at the beginning of summer. You may not want to sign up for them because when you renew, you may end up paying the highest prices on the market.

Hint: You can use Power Wizard at the end of every contract. We will show you the best rate on the market for your home.

Questions to ask yourself before choosing a plan

If you have a challenge paying your bill and have been late a few times, what do they charge for the late fee and notice fee?

It happens. If you know you may miss a bill, check the EFL or TOS for any late fees or notice fees and factor them into your total price.

Do you routinely get disconnected? Is there a disconnect fee? What’s the disconnect fee?

If it’s commonplace for your electricity to get disconnected from a missed bill, look for a disconnect fee. Factor this into your total price.

Find your total cost for electricity. How much will this plan cost for the full year?

Use all the information you’ve gathered on the pricing. How much will each electricity plan cost for the full year? Take your average energy use for each month and multiply by the rate per kWh. Add it all together to get your full year cost.

HINT: Power Wizard does all of this for you. In seconds.

All these factors we’ve listed above? We’ve already collected the plans and done the research. We can show you the best plan for your home in just seconds. The energy market is confusing and that’s why we made our tool in the first place.

We ensure Texans get the best rate possible and avoid surprise bills.

3. Here are the plans you need to be aware of and avoid as you shop

The energy market can be tricky because so many companies are competing for customers. Companies may advertise something that looks too good to be true—and be careful—because it usually is.

Ignore “Free” or “Rewards” Plans

They may sound too good to be true because they probably are. When a plan mentions “free” or “rewards”, it means they may be overcharging you for electricity and then giving a small percentage of that overcharge back to you. It may seem like they’re giving you free money or free electricity, but it’s a gimmick that may leave you overpaying in the end.

Be wary of offers from your current provider

The best deals are typically saved for new customers. Your current provider may send you an email telling you to renew with them but be wary of this. Sometimes, they sneakily increase the price, hidden in the new Terms of Service or Electricity Facts Label. Always read the fine print.

If you join our Gold plan, we can review these offers for you to ensure you’re on the best rate.

 

4. Keep track of your expiration date

Make sure you always know when your plan is going to expire. Your current electricity provider will let you know about 60 days out, and they may try to entice you to sign up for another plan of theirs. But it may not be the best plan for your home. The best deals are typically saved for new customers, and now that you are not a new customer, they may slowly increase your rate.

Hint: If you’re going to switch, switch your plan a week before your plan expiration date. If you don’t want to keep track of your expiration dates, join our Gold plan. We handle it all for you.

5. Switch at the end of a expired contract

It’s worth repeating that you should look through the plans available on the market and switch to a different electricity provider if you find a better plan.

• New customers usually get the best deals
• To get the lowest price on the market, you should consider switching
• Psst– Join our concierge Gold service and we will find the best plan for your home and switch it for you.

What are the pros and cons of a new electricity provider?

A brand-new electricity provider on the market could be the one with the best rates. What are the pros and cons of joining a new provider?

• Pro – All electricity comes from the same place, which means every electricity is the same electricity, just with different prices, so you could find a great price.
• Con – Everything is new to you again. If you sign up for our Gold service, we handle everything for you. And we mean everything. If you don’t want to worry about your electricity plans anymore, join our Gold plan.

How You Can Find an Affordable Electricity Provider

Don’t get overwhelmed when you shop for electricity in Texas — you’ve got other stuff to focus on. That’s why Power Wizard has your back.

For either a one-time payment or as an annual member, you get access to hundreds of electricity plans. Each of these is specially chosen based on your energy usage and preferences. Even better, we are not paid or compensated by any REP, you know there’s no external influence or sneaky fees. You’re only getting the best deal for you.

But it doesn’t all end when you find the best plan. With a subscription, Power Wizard will continue to monitor energy plans to ensure you’re getting the best rate for your home. Contract ending soon? You’ll get a notification and another chance to receive a customized plan search just for you. Our technology is on 24/7, and our expert staff is here to advise you whenever you’re shopping for electricity.

Get started with Power Wizard’s calculator to see current rates or contact us directly today!