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Choosing the right electricity provider in Texas

Dec 06, 2019by Angela

tips.pngTenant Tips

Choosing the right electricity provider in Texas

Dec 06, 2019by Angela

Spending a little time to choose the right energy provider is an easy way to keep your monthly budget in check. In fact, it could actually save you a few hundred dollars each year!

Since utility regulation varies based on where you live, today we're primarily focused on deregulated cities in our home state of Texas. (To find out if your city is deregulated, click here.) However, the fundamentals apply anywhere!

Here are four steps to find a plan that's not too big... not too small... but fits just right:

  1. Know your options.
    Our favorite place to shop energy providers in Texas is Power to Choose. Over 50 companies publish their plans in one spot making comparison a breeze.

    Many people don't even realize that so many options are available because only the largest mass market--but frequently those marketing dollars are packed into their price--so it's worth it to check out the smaller companies, too!

  2. Understand your usage.
    Most of the time prices are advertised as a "per kWh rate"... but that is really only the rate you pay if you reach a certain threshold. Price is frequently quoted based on a usage of 1000 kWh/month, but according to the U.S. Department of Energy, most houses use 920 kWh/month. Depending on the size of your home, your personal habits and the climate you live in, there is a good chance you never clear that threshold.

    Most carriers have an online portal available to customers. Setup an account if you haven't already and review your usage over the last year--then use this information to determine if you should be looking at prices for a threshold of 500 kWh/month, 1000 kWh/month or 2000 kWh/month.

  3. Re-evaluate annually.
    Providers bank on you having more exciting things to do with your time than re-shopping your plan each year--but what could possibly be more exciting than saving money?

    While we would all like to think that your "loyalty" will be rewarded with the most competitive rates, that just isn't the case. Set a reminder on your calendar once a year to review what you have. Review your provider's latest and greatest plans--and also review their competition.

  4. Understand the different cost components that a plan can include.
  • Fixed Costs:
    • Base Charges - Some providers charge a nominal monthly fee for being on the plan. (Other providers bake this into their per kWh rate.)
    • Taxes - Exactly what you think. No getting around these!

  • Usage Fee: What you pay each month per kWh of usage. These are typically structured in one of two ways:
    • "Fixed" Rate - You pay the same rate for each kWh of usage... regardless of any conditions like time of day or month of year.
    • "Variable" Rate - You pay a different rate for each kWh of usage based on conditions like time of day or month of year.

  • Other Costs:
    • Early Cancellation Fee - Most plans charge you to end your contract early.
    • Minimum Usage Fee - Some plans charge you for not hitting a certain threshold. This makes it extremely important you understand your monthly usage! (See Step #2 above.)
    • Assistance and Support Fees - Some companies actually charge a fee for you to make a payment with a Customer Service agent! Online bill pay may save you $3-$4/mo.

With a little work, getting yourself on the right electricity plan can save you serious money every year.

One other important consideration: any provider you select will use the same Transmission Delivery Utility (TDU) which is predetermined by region/area within Texas. So, while customer service may vary between companies, if the power goes out and you use Company A while your neighbor uses Company B... power will be restored for both of you at the same time: whenever the power is restored by your TDU! (Visit Quick Electricity to find your TDU.)

Drop us a note at hi@peachperch.com to let us know what other states we can help you navigate!

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