In Texas's deregulated electricity market, you choose your rate structure. Understanding the difference could save you hundreds—or protect you from unexpected spikes.
Texas Market Warning
During Winter Storm Uri (2021), some variable-rate customers saw bills exceeding $10,000 for a single month. Texas's wholesale market can be extremely volatile during extreme weather.
Your rate per kWh is locked in for the entire contract term. No surprises, no matter what happens in the market.
Contract Terms
12, 24, or 36 months typical
Current Rates
10-14¢/kWh (as of 2024)
Price Protection
100% protected from spikes
Your rate changes monthly based on wholesale electricity prices. Flexibility comes with risk.
Contract Terms
Month-to-month, no commitment
Rate Range
8-50+¢/kWh depending on season
Price Protection
None - exposed to market
| Scenario | Fixed (12¢) | Variable |
|---|---|---|
| Spring (1,000 kWh) | $120 | $90 (9¢) |
| Summer (2,000 kWh) | $240 | $360 (18¢) |
| Fall (1,200 kWh) | $144 | $120 (10¢) |
| Winter Storm (1,500 kWh) | $180 | $750+ (50¢+) |
| Annual Total | $684 | $1,320+ |
*Example based on typical Texas usage patterns. Actual rates vary by provider and market conditions.
The peace of mind and protection from extreme weather events outweighs the potential savings from variable rates. Texas's grid is uniquely vulnerable to price spikes during heat waves and cold snaps.
Exception 1: If you're only in Texas for 3-6 months, variable may make sense.
Exception 2: If you actively monitor rates and can switch quickly, variable can work.
Exception 3: If you have solar + battery and minimal grid usage.
The official Texas comparison site. Enter your zip code and usage to see all available plans. Look at the "Price per kWh" column for true comparison.
Every plan has an Electricity Facts Label (EFL). This shows the true rate at 500, 1000, and 2000 kWh usage levels, including all fees.
Some plans have minimum usage fees, base charges, or "free nights" gimmicks that increase daytime rates. Always check the EFL.
Fixed-rate contracts auto-renew to variable rates when they expire. Set a calendar reminder 2 weeks before your contract ends.