Texas Deregulated Electricity Map​ (2025)

Texas is unique in the U.S. electricity landscape. Rather than being locked into a vertically integrated utility, most Texans can choose their electricity supplier. Deregulation has spurred competition among dozens of retail electric providers (REPs), encouraged green-energy innovation and kept prices below the national average.

However, the state’s power market can be confusing because it contains a mixture of deregulated and regulated territories. This guide breaks down how the market works in 2025, where deregulation applies, recent changes such as Lubbock joining the competitive market, and how to choose the right electricity plan.

The map below illustrates the split between deregulated and regulated territories. Counties highlighted in color represent deregulated service areas and show which TDU serves that county. Areas shown in grey are regulated. Because municipalities can vote to opt in to deregulation—Lubbock being the most recent example—residents should check their ZIP code on a comparison site or with the PUCT to confirm their status.

Electricity deregulation separates the generation, transmission and distribution functions of a vertically integrated utility. In Texas, Transmission and Distribution Utilities (TDUs) maintain the poles and wires that deliver power to your home, while REPs sell the electricity and handle billing and customer service. TDUs are regulated by the Public Utility Commission of Texas (PUCT) and charge a fixed monthly (base) fee (some REPs may waive this fee) and a per‑kilowatt‑hour delivery fee. Those charges appear on your bill as “TDU Delivery Charges” and are the same no matter which REP you choose (the fees change based on the TDU). The REPs (who are also regulated by the PUCT) set your energy rate and plan structure.

This separation allows competition among REPs, giving consumers more options and the freedom to choose plans that fit their lifestyle. According to the PUCT, Texas’s deregulated market is now the largest mandatory retail‑choice program in the country; roughly 85–90% of Texans can shop for electricity

The history behind Texas’ switch to a competitive retail electricity market is long, full of politics, corporate bureaucracy, and varied claims of what was best for the consumer. Those pushing for deregulation of the retail electricity market believed that large investor-owned utilities had a monopoly on the market.

There was no competition in the pricing of rates per kWh. The utility companies set the price, and the consumer paid it.

Supporters of deregulation argued that consumers would pay a lower price for electricity if individual providers were allowed to purchase electricity at a wholesale price and then sell it to consumers for a profit. Ultimately, the argument was: that multiple providers competing for the same customers would drive prices down. 

Below is a timeline of how things played out.

• Pre‑1990s: Texas utilities were vertically integrated monopolies that generated, transmitted and sold electricity. High prices and a lack of competition prompted calls for reform.
• 1995 – Senate Bill 373: The Legislature began restructuring the wholesale market by requiring utilities to give independent generators access to transmission lines and encouraging competition.
• 1999 – Senate Bill 7: Governor George W. Bush signed Senate Bill 7, introducing retail competition in areas served by investor‑owned utilities. The bill also created the “Price to Beat” mechanism to prevent incumbent utilities from undercutting new entrants.
• Jan 1 2002 – Retail market opens: Deregulation took effect statewide. Customers in eligible areas could select any REP, while TDUs continued to deliver electricity. Municipal utilities and electric cooperatives were allowed to opt out of the program.
• 2002–2024 – Expansion: Over time, participation grew.
• 2024 – Lubbock joins deregulation: Lubbock Power & Light became the first large municipal utility to opt into deregulation. Residents were allowed to shop for providers between Jan 5 and Feb 15 2024. Those who didn’t choose were assigned a default provider in late February. The physical switch from LP&L to the selected REP occurred between March 4 and April 4 2024. By April 2024, Lubbock customers received their final municipal bill and began receiving bills from their chosen provider.
• 2025 – More than 173 of Texas’s 254 counties are fully or partially deregulated, giving more than 800 cities the power to choose. However, roughly 10 to 15% of Texans still live in regulated areas—mostly those served by municipal or cooperative utilities.

Does Texas Deregulation Look Different Than Other Deregulated States?

Although several states have active retail choice programs, no other state has adopted as large or widespread a program like Texas. Unlike other deregulated states, “electrical retail choice is mandated in Texas.” Because of this, close to 90% of residential customer sales are provided by competitive suppliers.

Compare this number to the four states with the next highest levels of participation in a retail choice program:

• Ohio: ~50%
• Illinois: ~31%
• Massachusetts: ~49%
• California: ~30%

Texas is served by six TDUs:

1. Oncor
2. CenterPoint Energy
3. AEP Texas North
4. AEP Texas Central
5. Texas‑New Mexico Power (TNMP)
6. Lubbock Power & Light

These companies manage the delivery infrastructure across deregulated zones. In total, 173 counties are fully or partially deregulated, meaning residents in those counties can choose from a large pool of REPs. More than 800 cities fall under these TDUs. Examples include large cities such as Houston, Dallas, Fort Worth, Corpus Christi and Waco, as well as smaller towns like Abilene, Brenham and Laredo. Because TDU boundaries do not follow county or city limits, some municipalities (e.g., Garland or Bryan) are partially deregulated; most of the time, specific ZIP codes determine whether you can choose your provider, but to be 100% sure, you would need search your full address. Below you can find a list of deregulated cities under their own TDU.

There are two groups of consumers who are excluded from mandatory deregulation in Texas:

1. Customers in investor-owned utility service areas outside the ERCOT Regional Transmission Organization, for example, Entergy Texas, Southwestern Electric Power Company (SWEPCO), Southwestern Public Service Company (SPS), and El Paso Electric Company
2. Customers in areas serviced by municipal or cooperative utilities (even those within ERCOT) who have chosen to opt-out of the retail choice program. For example, Austin Energy or Bluebonnet Electric Cooperative.

Senate Bill 7 allowed municipal utilities and electric cooperatives to decide whether to participate in deregulation. Many opted to remain regulated because they are not‑for‑profit entities whose mission is to provide value to their communities. Revenues are reinvested locally and rates are set by city councils or member boards. Once a municipal utility opts in to deregulation the decision is irrevocable, so municipal utilities weigh the potential benefits carefully. As of 2025, only a handful of cooperatives (such as Nueces Electric Co‑op) and LP&L have opted in.

How Does the Market Work in These Areas?

Usually, the municipal utilities’ rates are regulated and set by the PUCT, which ensures that the rates reflect the “overall” costs the utility incurs and provide a reasonable return on investment. Whenever a utility seeks a rate adjustment, it must inform its customers. Those customers and any impacted groups have the right to participate in the rate case and share their input about the proposed changes.

For example, let’s say you are moving from Houston to El Paso. In Houston, you had several options for purchasing your electricity. You could shop around for rates and plan types that best fit your needs. All that changes in El Paso where the only option for electricity service is El Paso Electric.

El Paso Electric is a public-owned utility company (therefore exempt from deregulation). It is the sole electricity provider in the area and has been operating since 1901. Because there is no electric choice available in El Paso, all residents must purchase their electricity directly from El Paso Electric.

El Paso manages all generation, transmission, and distribution for the area it serves. And, the rates are also managed by El Paso Electric.

Municipal utilities and electric cooperatives that opted out of deregulation continue to control generation, transmission and distribution in their service areas. Large regulated cities include Austin (Austin Energy), San Antonio (CPS Energy), El Paso (El Paso Electric) and Brownsville (Magic Valley Electric Co‑op). Other regulated communities include Bryan (Bryan Texas Utilities), Burnet, College Station, Denton, Georgetown, Kerrville, New Braunfels, San Marcos and parts of Garland and The Woodlands. In these areas, residents buy electricity directly from the municipal or cooperative utility and cannot switch providers.

Having dozens of providers and hundreds of plans can be overwhelming. The good news is that you do not have to navigate the market blind. Here are evidence‑based strategies for making a smart choice:

Match the plan to your usage

Electricity plans advertise a price at 500 kWh, 1,000 kWh or 2,000 kWh of monthly usage. Choose a plan that aligns with your actual consumption to avoid unexpected charges. Many providers offer usage/bill‑credit or tiered‑rate plans that look cheap at a specific usage level but can cost more if your usage is higher or lower. If you’re unsure, a basic fixed‑rate plan is usually safest.

Understand plan types

Texas offers several plan structures:

• Fixed‑rate plans: Lock in your price per kWh for a set term. Ideal for predictable budgeting.
• Variable‑rate plans: Rates change monthly with market prices; riskier because costs can spike.
• Tiered/bill‑credit plans: Provide bill credits when usage falls within certain ranges; rates may go up when usage falls outside those ranges.
• Prepaid (no‑deposit) plans: Require an upfront payment; convenient if you have credit challenges.
• Green/renewable plans: Offset your usage with renewable energy certificates or supply power from renewable sources.
• Time‑of‑use plans: Offer free or reduced rates during off‑peak hours or weekends. Good for households that can shift usage.

Read the Electricity Facts Label (EFL)

Every plan comes with an Electricity Facts Label that details the rate structure, contract term, fees and early termination penalties. Experts recommend reading the EFL like a nutrition label to spot hidden fees and understand the true cost. Pay attention to the base charge, energy charge, TDU delivery fees and other information mentioned there.

Consider contract length and seasonality

Market rates fluctuate with demand. Shopping in spring and fall—when demand is lower—can yield better prices. Longer contracts often offer price stability, while shorter terms let you re‑shop sooner if rates fall. Balance the desire for stability with the flexibility to switch when better deals arise.

Check deposits, credit requirements and cancellation fees

Many REPs require a deposit based on your credit score. Prepaid plans allow you to avoid credit checks but usually charge higher rates. Early termination fees can vary widely; choose a contract length you can realistically keep.

Try an Electricity Comparison site like Power Wizard

Since the electricity market in Texas is big and at times complicated, there are marketplaces that aim to make the life of Texans a little easier but offering in one place a way to search and sign up for a plan that fits their needs. Try Power Wizard, were you can filter and compare electricity plans baased on your preferences and needs.