Power Companies

Your goal in the new year is to take control of your household budget.

You look for ways to reduce spending: clip coupons, cook at home instead of eating out, cancel streaming services.

Sure, doing these can save a few dollars but did you know changing your power company could possibly save you hundreds?

Choosing the right power company can save you money in the new year and help your budget stay on track.

But with so many choices, how do you pick the right company for you?

Read this quick guide to find out everything you need to know so you can choose the best power company for your financial and energy needs.

What is a Power Company?

Power companies, retail electric providers, and utility companies. Aren’t they all the same?

No! The difference is the services they provide.

Most of the electricity in the United States is generated from electric power plants. The electricity is sold to electric utilities or REP, then distributed to consumers.

A power company is a public utility that provides electricity.

Retail electric providers (REP) purchase electricity from a power generator then sell it to customers in deregulated areas. We’ll talk more about deregulation in the next section.

An electric utility is a local electric utility company. They own and maintain utility poles and power lines.

Why Do I Even Get to Choose my Own Power Company in Texas?

If you have ever lived outside of Texas (with the exception of a few states) then you weren’t able to choose your power company.

You were forced to use the local power company paying absorbent fees and charges with absolutely no choice.

Fortunately for Texans, the Texas Senate Bill 7 was passed allowing energy to be deregulated in most parts of the Lone Star State.

But what does this mean for you?

You now have options and choices when it comes to which power company you use.

You Get A Choice of Power Company Because Electricity is Deregulated

In 1999 Texas faced an energy generation shortage. The generation of energy was not able to keep up with the demand.

By introducing and passing the Texas Senate Bill 7 in 2002, many parts of Texas allowed for the deregulation of electricity. This opened up the energy market to competition.

How Does Deregulated Electricity Work?

Deregulated electricity allows retail electric providers (REP) to purchase wholesale electricity at a discounted rate. Then those REPs pass the savings on to you.

Choosing a power company in Texas gives you the opportunity to shop around for the best plan for your individualized energy needs.

What is the Cheapest Power Company in Texas?

Your goal is to get your budget on track. You want to save money.

So, you look for the cheapest electric company in Texas.

But, it isn’t that simple!

The cheapest rate may not be the best choice for you.

Instead of searching for the cheapest company, you should look for the best power company that suits your individual needs and usage patterns.

These are some factors to consider when finding the best plan for your energy needs:

• Residential or Commercial usage
• Amount of energy usage
• Size of your home
• Age of your home
• Your zip code
• Type of energy plan you want

In the next section, we will go into further detail about these factors and how they affect the cost of your electricity bills.

Each Power Company Has Its Own Rates and Plans

In Texas, there are more than 160 REPs with over 2,000 individualized plans. With so many options, where do you begin to find the best plan for your energy needs?

Power Wizard uses proprietary data science and technology to analyze every aspect of the way YOU use electricity and locates the most affordable plans to match your needs.

These are the factors Power Wizard uses to determines the best energy plan for you:

Factor #1: Residential or Commercial

The first factor we examine is whether you are in need of energy for your home, your business, or both.

Why does this matter?

Residential energy usage is different from commercial usage.

In your home, most of the energy is used to power electronics, lights, and appliances. You probably only have a handful of people utilizing energy in your home each day.

If you own a business, such as a gym, most of the energy usage comes from lights, fans, A/C and exercise equipment. A gym can easily service hundreds of people a day (especially at the beginning of a new year).

On the surface, it may seem both places use energy in the same way. But the amount of energy it takes to power a home is far less than what it takes to power a business.

Where you use electricity and how you use it is important to consider when determining the best plan for your electricity needs.

Factor #2: Your Zip Code

Your zip code may not be the title of a TV show or in the lyrics of a song, but it is a big factor in choosing the best electricity plan for your needs.

Deregulation of electricity is available to most Texas cities with some exceptions including El Paso, Amarillo, San Antonio, Lubbock, Austin, San Marcos, just to name a few.

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Factor #3: Size and Age of Home or Business

The size and age of your home or business matters!

If you live in a 1700 sq ft home built in 1979, it is probably not as energy efficient as a 2000 sq ft home built in 2019.

Older homes have loads of charm and unique aesthetics but unless your home has undergone energy efficiency renovations, it will not consume energy in the same way as a home built 30 years later.

Whether you live in a classic colonial home or a modern downtown loft, Power Wizard can find the best available electricity plan to meet your specific needs.

Factor #4: Type of Power Plan That You Want

There are several types of electricity plans:

• Fixed-rate
• Variable-rate
• Free weekends
• Free nights
• Prepaid

These plans are designed to meet the specific needs of energy users.

Some allow for budgeting energy usage while others claim to save money during certain times of the day or the year.

Keep reading to learn more about the benefits of each type of plan.

Why Cheap Power Companies Can be Misleading

Have you ever bought cheap trash bags? The only difference you see is the price, so you pick the cheapest bags on the shelf.

Then as you attempt to take the trash out, the bag rips spilling coffee grinds, used napkins and banana peels all over your newly mopped kitchen floor.

The cheapest trash bags aren’t always the best option:

They rip and need to be double or triple bagged just to get the trash outside.

The cheapest version can actually end up costing you more money and more time.

Just as with trash bags, the cheapest electricity company may not be the best option for you.

Rates Can Change Often

Electricity rates change every 15 minutes based on supply and demand, weather patterns, and seasonal temperatures.

How does rate change affect your electricity bill?

If you choose an indexed rate plan, when the rates are low your bill is low.

Sounds great, right?!

But here is the catch: when the rates are high (like in the heat of Texas summers) your bill increases dramatically.

Some Texans have seen their summer energy bills increase to $100 per day!

Hidden Fees

Hidden fees are tricky because they are extremely hard to spot in a lengthy contract.

Some hidden fees include:

• Connection fees
• Cancellation fees
• Usage requirement fees
• Delivery charges
• Maintenance charges

You may find a power company that offers a rate of .07 cents per kilowatt-hour but once the hidden fees are tacked on, your bill can easily double or triple in price.

Fine Print Issues

It is imperative to read and understand the fine print in your electricity contract because hidden fees can cost you big.

Some electricity plans start off cheap with low rates but the fine print states the rates will double after the first year, or if you do not meet a minimum monthly energy usage.

Many cheap plans are cheap because you are charged extra somewhere else.

Don’t be fooled by cheap plans!

Power Wizard’s unbiased algorithm evaluates all plans, including additional and hidden fees, contract details and fine print to find the best plan available for your energy needs.

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What Are Some of the Popular Features that Power Companies Offer?

Since there is so much competition in Texas’s deregulated electricity market, REPs offer popular features to entice you to pick them over a competitor.

Here are a couple of popular features offered by power companies in Texas:

Free Weekend Plans

Free weekend plans allow consumers to use electricity on the weekends at no cost.

One thing to be aware of is the times and days that are included in the “weekend.”

The weekend is Friday through Sunday, right?

Not always! Some power companies consider the weekend Saturday morning through Monday morning.

If you are not sure which times your energy is free, you will not get the most out of this feature. As you can see, this can be more confusing than you think.

Free Night Plans

Free night plans are similar to free weekend plans, except the free energy is at night.

With free night plans, be aware of whether the rate during non-free times is higher than the market average electricity rate.

In some cases, free electricity may end up costing you more during peak-hours.

Fixed Rates

A fixed-rate plan locks in the price you pay per kilowatt-hour for a predetermined length of time.

These rates are fixed because the retail electric provider purchased energy at an average market price.

The bonus of this feature is your energy rates will not fluctuate as the temperatures do.

Non-Electrical Perks

In addition to “free electricity” or fixed-rates, many REPs offer other perks as well:

BOGO Plans: This promotion suggests you only pay for 50% of your energy usage.

Be sure to read the fine print! Check for limits on when the 50% can be used.

Prepaid Plans: Think of a prepaid plan as a type of retainer. You pay a certain amount of money upfront and as you use electricity money is deducted from the initial payment.

You may be tempted to choose this plan because it seems easier to budget your energy bills, but beware these plans often come with hefty disconnection and reconnection fees.

Charity Giving/Matching: Some REPs offer to make donations to local charities and nonprofits.

Who doesn’t feel good about giving to a noble cause? But if you are trying to save money this feature doesn’t help you very much.

Smart Thermostats/Smart Speakers: Smart devices are taking over and REPs are getting in on the action.

Many REPs offer a free smart thermostat or smart speaker to all new customers. They suggest these devices will help save on your energy bill and allow you to stay up to date with your energy usage.

These popular features may be helpful but the “best” features depend on your schedule and unique needs.

Criteria for Choosing A Power Company in Texas

You are able to choose your electricity provider but what should you be looking for when you are comparing power companies in Texas?

Variety of Electricity Plans Available

Variety is the spice of life! If you can only choose between two types of electricity plans, do you really have a choice?

You want a power company that offers a variety of electricity plans.

More plans mean you will find an individualized plan that will meet your financial and energy needs.

Competitive Prices for Electrical Plans

The purpose of deregulated electricity is to create a competitive market place where you have access to the best prices.

You want a company that will be easy on your budget and your wallet while still providing the best service.

Customer Service

Customer service is one of the most important features of any business.

How you are treated vastly affects your view of a company and determines whether or not you will conduct business with them in the future.

Think about a time when you had a bad experience with a company:

• Your item did not arrive on time
• Your lunch had a hair in it
• The electricity went out 30 minutes before a huge event at your business

You call the customer service department:

If you receive a friendly greeting, feel heard and receive a solution you will chalk it up to “everyone makes mistakes.”

On the contrary, if you have a frustrating customer service experience you will probably never use the company again.

How Easy They Are to Work With?

Technology is everywhere!

You can order virtually anything online and have it delivered to your doorstep in a matter of minutes. Or speak to friends and families across miles and oceans on tiny screens.

We expect the ease of technology to be incorporated into every aspect of our lives including our power company.

Does your current power company have a user-friendly website? Can you check your energy usage from an app on your phone? Is auto-pay an option?

Power Company Reviews and Reputation

Reviews, like experiences, are very subjective.

You may go to a restaurant on a slow night, order the chef’s special and have a server who is having a great day.

This adds up to a great meal, a great experience, and a great review.

However, if your friend goes to the same restaurant on a busy night, orders the newest item on the menu and has a struggling server their experience will be very different.

Keep these things in mind when reading reviews:

• Read all the reviews not just the best or worst ones
• Is there a common complaint?
• Are good reviews very generic?
• Do the reviews change how you view the company?

Hidden Charges and Fees

This seems to be the biggest complaint among consumers and for good reasons.

We talked about hidden charges and fees above. Just remember to always read your electricity contract very carefully.

No one wants to pay extra costs, especially hidden charges and fees!

The criteria above may or may not be important to you but what is important is that you want to pay the least amount of money for the best available electricity plan.

Why is it Hard to Compare Power Companies in Texas?

At this point, your head is probably swimming, feeling overwhelmed as you begin sifting through your options of power companies.

Consider:

• The factors mentioned above
• Terms of service
• Length of the contract
• Service options
• Energy usage
• Home/business size and age

You don’t need to use the “eeny, meeny, miny, moe” decision-making method to find the best power company. Power Wizard can do it for you.

Using our modern, streamlined technology Power Wizard will do all the work to find the best electricity plan for your unique energy needs.

Our unbiased algorithm considers all the factors that influence your electricity bill to find the most effective plan for you.

Power Wizard understands how plans differ and uses this knowledge to locate a plan that will fit your individual electricity needs.

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Finding a Power Company Near Me

At this point, you are tempted to do a quick internet search for “power companies near me.”

If you do, your results will include several electricity companies, any one of these should be fine right?

These companies may be physically located near your home or business but there is no guarantee they provide service in your zip code or offer plans and options that are important to you.

How can you find a power company near you that will provide you with the best plan for your energy needs?

Option 1: Manually Spend Hours Searching Through REPs’ Websites

You can scour the internet, searching through the 160 retail electric providers and their 2,000+ plans.

To accurately compare power companies in Texas manually you will need:

• Spreadsheet software
• Extensive knowledge of energy plans and REPs
• Endless hours of your precious time

With so many electricity providers and plan options, the combinations seem limitless.

Searching and comparing each company and plan manually is a daunting task.

You don’t need to be an electricity plan expert and have a thousand extra hours to find the best electricity plan for your needs. Let Power Wizard find it for you.

Option 2: Spend Less Than 5 Minutes Using An Unbiased Algorithm to Find You the Best Plan with the Best Company For You

Power Wizard will do all the hard work for you and the best part, our process will take less than 5 minutes of your time.

Energy usage is like a thumbprint, it is unique to each individual. Power Wizard uses your smart meter data to create your energy usage profile.

Our technology uses your usage profile to scan hundreds of energy rates and plans to match you with the best one.

We consider the fine print, hidden fees, and the set rate before selecting the right electricity plan for your home and/or business.

Are you ready to find the best electricity plan for you? Visit Free Savings Estimate Tool to get started today.

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