Texas Electricity Prices

Will Texas Electricity Rates Rise or Fall in 2025?

What’s Driving Texas Electricity Prices in 2025?

Residential Electricity Price Forecast

Compare Texas Electricity Prices

How Texans Can Save on Electricity in 2025

Take Control of Your Energy Costs

Frequently Asked Questions

• What is the average residential electricity price in Texas?

  The average residential electricity price in Texas is 14.51 ¢/kWh, or 15% less than the United States average.

  Updated September 2024
  Source: U.S. Energy Information Administration (EIA)

• Will Texas electricity prices go down in 2025?

  Wholesale prices are expected to decrease, but retail rates may fluctuate due to demand and market factors.

• What affects Texas electricity prices the most?

  Natural gas prices, renewable energy growth, demand from large-scale users, and extreme weather. Seasonal fluctuations, such as high demand during hot summer months, can cause electricity prices to rise.

• What is the average business and commercial electricity price in Texas?

  The average commercial electricity price in Texas is 9.22 ¢/kWh, 47% lower than the United States average.

• What electricity company has the best prices in Texas?

  In the state of Texas, there are over 60 retail electric companies, each with dozens of energy plans available to consumers.

  However, the best electricity price for your home depends on your kWh usage, not the company.

  Using Compare Power, you can explore energy plans that align with your home’s usage history to quickly find the one that best fits your energy habits, regardless of the provider.

• How do utilities and energy providers differ?

  Utility companies are responsible for maintaining and operating the energy grid.

  In a power outage, you can depend on them to restore and maintain the power lines and other equipment that delivers energy to your home or business.

  Utility companies serving Texas include Oncor Electric Delivery, Centerpoint Energy, AEP Texas, and Texas-New Mexico Power.

• What is ERCOT?

  ERCOT (Electric Reliability Council of Texas) keeps the lights on for about 90% of Texas. It runs the power grid and makes sure enough electricity is available to meet demand.

  What does ERCOT do?

  • Manages the grid – Keeps electricity flowing across the state.
  • Oversees the electricity market – Helps set wholesale prices, which affect what customers pay.
  • Plans for the future – Ensures Texas has enough power to handle growth and extreme weather.
  • Prevents blackouts – Monitors the grid in real-time and takes action if demand gets too high.

  How does this affect you?

  • ERCOT doesn’t sell electricity—your retail provider does that.
  • Prices can jump when demand spikes (like during heat waves or winter storms).
  • Grid issues can lead to rolling blackouts, but ERCOT works to prevent them.

  Want to keep your bill low? Choosing the right electricity plan matters more than ERCOT’s pricing. That’s where tools like Compare Power’s Live Link™ help you find a plan that works for you.

• Why is my electricity bill so high all of a sudden?

  The most common reasons for high electricity bills in Texas include:

  1. Spikes in Energy Consumption

  • Increased usage due to seasonal changes, guests, or lifestyle shifts.
  • Smart Meter Texas can help track your usage.

  2. Extreme Weather

  • Texas’ intense summers and unpredictable cold snaps cause higher heating and cooling costs.
  • HVAC systems work harder during temperature extremes.

  3. Inefficient Home

  • Energy vampires: electronics and appliances using standby power.
  • Poor insulation, old HVAC systems, and inefficient lighting.

  4. Lifestyle & Habits

  • Thermostat settings, frequent laundry loads, and long shower times impact energy use.
  • Running appliances during peak hours increases costs.

  5. Your Electricity Plan

  • Being on the wrong plan for your usage pattern.
  • Variable rates that spike during peak demand periods.

  6. Expired Electricity Contract

  • Rolling into a provider’s default rate can significantly increase costs.
  • Failure to renew leads to much higher month-to-month pricing.

  7. Missed Usage Discounts

  • Some plans require a specific kWh threshold to get bill credits.
  • Falling short of the required usage can remove discounts.

  8. A New Electricity Plan

  • Unexpected changes in rate structure, time-of-use pricing, or hidden fees.
  • Some plans look cheap but don’t align with actual usage patterns.

  9. A New Home

  • Different insulation, HVAC efficiency, or electrical setups affect energy costs.
  • Larger spaces or outdated appliances can drive up consumption.

  10. Billing Mistakes

  • Incorrect meter readings, double charges, or estimated billing errors.
  • Reviewing the bill for discrepancies can help catch errors early.

  11. A Missed Payment

  • Late fees and possible higher deposit requirements.
  • Some providers increase rates for customers with a history of missed payments.

  12. Billing Cycles

  • Billing cycles range from 28 to 32 days, leading to inconsistent monthly costs.
  • Longer cycles can result in higher-than-expected bills.

  13. A Billing Error

  • Incorrect meter readings or estimated charges instead of actual usage.
  • Disputing errors promptly can prevent unnecessary overcharges.

  Each of these factors contributes to why electricity bills can unexpectedly spike in Texas, and understanding them helps in taking action to lower costs.

• What is considered a good electricity rate in Texas?

  A good electricity rate in Texas typically ranges from 10¢ to 13¢ per kWh for residential customers. However, rates vary based on location, usage patterns, and market conditions.

  The best way to determine a good rate for your situation is to compare offers from multiple providers using a tool like Compare Power.

• Why do electricity rates vary in Texas?

  Electricity rates in Texas vary due to fuel costs, seasonal changes in demand, transmission and distribution charges, and the provider’s operational costs.

  Additionally, Texas has a deregulated energy market, meaning consumers can choose from numerous providers and plans, leading to a wide range of rates.
• Are electricity rates going up or down in Texas?

  Electricity rates in Texas can fluctuate based on market conditions, fuel costs, and other factors.

  However, per the U.S. Energy Information Administration’s forecast for 2025, wholesale power prices are expected to decrease due to lower natural gas costs and increased renewable energy generation.
• Can I choose my electricity provider in Texas?

  Yes, Texas has a deregulated energy market, meaning consumers can choose their electricity provider from several options.

  You can compare different providers and plans to find the best one for your needs.

• When is the best time to lock in a rate?

  During periods of low demand, such as spring or fall, prices tend to be lower.

• How do Texas electricity prices compare to other states?

  Texas electricity prices are generally lower than the national average.
  
  As of October 2024, the average residential rate in Texas was 14.51 ¢/kWh, or 15% less than the United States average.
  
  This is mainly due to Texas’ deregulated electricity market, which promotes competition among providers, and the state’s diverse energy mix, including significant wind power generation.

• How can I find the best electricity plan in Texas?

  Finding the best electricity plan in Texas comes down to matching a plan to your energy habits so you don’t get tricked by gimmicky pricing.

  The Easiest Way? Live Link™ on Compare Power.

  Instead of guessing, Live Link™ pulls your energy usage from Smart Meter Texas and shows you the best plans based on how you use electricity—no surprises, math, or getting stuck with a bad plan.