Fixed-rate electricity prices in Texas are determined by the current wholesale energy market, the cost of delivering electricity to your home, and your contract length. Once your rate is set, it won’t change month to month, meaning you’re protected from seasonal price spikes, even when the market heats up.
A fixed-rate electricity plan is exactly what it sounds like—you lock in one price per kWh charged by your retail electricity provider (REP) for the duration of your contract. That means your price per kilowatt-hour won’t change, even if the energy market does. This provides stability and protection against sudden rate spikes resulting from fluctuations in demand, extreme weather conditions, or supply issues.
In Texas’s deregulated electricity market, which launched in 2002, residents can choose their REP instead of being assigned a utility by default. Since deregulation began, the number of available fixed-rate plans has steadily grown, giving Texans more options than ever to lock in a more predictable energy bill.
Your monthly energy bill will also include Transmission and Distribution Service Provider (TDSU) fees and regional administrative fees that can vary throughout the year. These fees are outside of REP control; they must be charged without markup to every customer regardless of plan type.
Fixed-rate electricity plans are designed for simplicity and stability. Here’s how they work:
Fixed-rate and variable-rate plans work very differently, and choosing the right one depends on your budget, risk tolerance, and how long you plan to stay in your home.
Fixed-rate plans are all about consistency. They:
Variable-rate plans follow the market. The price you pay per kilowatt-hour can go up or down each month based on market conditions, like wholesale rates, weather, and supply and demand, among other factors.
Bottom Line: If you want steady rates and fewer surprises, a fixed-rate plan is your best bet. But if you’re comfortable riding the highs and lows of the market, a variable-rate plan might give you more flexibility.
No matter the reason you’re canceling or switching your current electricity plan, always check your service agreement to see what steps you need to take to avoid being charged an ETF. In some cases, paying an ETF may be worth the savings you’ll get from switching.
Fixed-rate electricity plans take the guesswork out of your energy bill, making them ideal for:
Not all fixed-rate electricity plans are the same. Review each plan’s Electricity Facts Label (EFL) before enrolling for contract terms, full pricing details, and more, so you know exactly what you’re signing up for.
Trying to shop for electricity on your own can mean bouncing between dozens of provider websites and digging through fine print just to compare a few plans. Power Wizard makes it easier by putting electricity plans from multiple providers all in one place, so you can see your options side by side without the headache. Here’s how to get started:
Not all fixed-rate plans are built the same. From contract lengths to renewable energy options, the details can impact your long-term savings and energy footprint. Below are the most common fixed-rate electricity plan types in Texas, so you can choose the one that best fits your lifestyle.
The biggest difference between fixed-rate plans often comes down to how long you want to commit.
Short-term fixed-rate contracts:
Long-term fixed-rate contracts, on the other hand:
Renewable fixed-rate plans let you lock in a consistent electricity rate while supporting cleaner energy sources. These plans guarantee that a set percentage of your electricity comes from renewables like wind, solar, or other sources. They’re a great option if you want more predictable billing and a greener lifestyle.
Bill credit fixed-rate plans combine rate stability with a usage-based discount. If your monthly electricity use falls within a specific range, for example, more than 1000 kWh every month, you’ll earn a bill credit that lowers your total cost.
Locking in a fixed-rate electricity plan is a smart first step for budget-conscious consumers, but a little planning can help you stretch those savings even further. From budgeting habits to staying ahead of contract milestones, here’s how to power up your savings and avoid common pitfalls.
Power Wizard takes the guesswork out of finding the ideal fixed-rate electricity plan. By aggregating dozens of Retail Electric Providers (REPs) and dynamically updating rates, our platform ensures you see the latest offers side by side. Instead of manually visiting multiple REP sites, you get a clear, apples-to-apples comparison in seconds.
A fixed-rate electricity plan locks in your per-kWh price for the length of your contract—typically 6 to 36 months—so your rate won’t change even if market prices rise.
If you value budgeting certainty and want to avoid seasonal price spikes, a fixed-rate plan is ideal. It’s especially beneficial for families, small businesses, and anyone who wants a more predictable billing schedule.
Shorter terms (6–12 months) offer more flexibility to switch plans. Longer terms (24–36 months) typically lock in lower rates, but require a longer commitment. Match your choice to your moving plans and risk tolerance.
Yes, but canceling mid-term usually incurs an Early Termination Fee (ETF). However, you should always compare the ETF against potential savings to decide if switching is worthwhile.
Many REPs offer fixed-rate plans with 25%, 50%, or 100% renewable content. These green fixed-rate options let you support wind or solar projects at a predictable price.
Fixed-rate plans guarantee your cents-per-kWh price over the term and offer more predictable monthly bills. Variable-rate plans fluctuate monthly based on wholesale market conditions, offering potential savings but greater risk.
Review the Electricity Facts Label (EFL) for Early Termination Fees (ETFs), monthly service fees, and any deposit requirements.
To calculate your expected savings with a fixed-rate plan, multiply your average monthly usage (in kWh) by the fixed-rate price and compare it to the projected costs of the other plan.
