Energy deregulation is a game-changer in the Texas energy market. Back in 2002, Texas made a bold move to deregulate its energy market, giving residents and businesses the power to choose their electricity providers and plans. This shift aimed to foster competition, lower energy bills, and enhance service quality for Texans living in deregulated areas.
Before deregulation, Texans had limited options and were stuck with their local utility company. They often faced higher energy costs and subpar customer service. The lack of competition meant there was little incentive for utility companies to offer better rates or improve their services.
With the advent of energy deregulation, the Texas energy market opened up to multiple energy providers, each vying for customers by offering a variety of energy plans and competitive pricing. This increased competition has driven down electric bill and pushed providers to improve their customer service.
However, navigating this deregulated energy market can be challenging. The plethora of options can be overwhelming, and selecting the right energy provider and plan requires careful consideration. This is where independent marketplaces like GridHacker can help.
'These platforms provide expert guidance and filtering options, making it easier for Texans to find the best energy plan tailored to their needs.
In Texas, you have the power to choose your electricity provider. Texas electricity rates can vary by location and time, making it important to compare different plans. Since 2002, the state has operated under a deregulated electricity market, meaning residents in most areas aren’t locked into a single utility company. Instead, they can shop for electric plans from multiple Retail Electric Providers (REPs), fostering competition that, in theory, should lead to better pricing and service.
To help consumers navigate this market, the Public Utility Commission of Texas (PUCT) created PowerToChoose.org, a state-run website where Texans can compare electricity plans from different providers. Texas energy providers are listed on the Power to Choose website, allowing consumers to compare their options. The site is meant to offer an unbiased, transparent marketplace where users can browse options based on price, contract length, and other factors.
At first glance, Power to Choose seems like a great tool. It lists dozens (sometimes hundreds) of plans available in any given area, giving consumers access to competitive rates without having to visit each provider’s website individually. Sounds like a win, right?
Well, not so fast.
While the idea behind Power to Choose is solid, the execution has left a lot to be desired. Over time, energy providers have found ways to game the system, using tricky pricing structures and short-term promotions that look good on the surface but often result in unexpectedly high bills.
That’s where things get complicated—and why you need to be cautious when shopping for electricity plans using Power to Choose.
Shopping for an electricity provider in Texas isn’t as simple as picking the one with the lowest advertised rate. Thanks to deregulation, you have dozens of energy companies to choose from—but not all plans are as good as they seem.
PowerToChoose.org was created to help Texans compare providers, but here’s the catch: not all providers play fair. Many use misleading pricing structures, hidden fees, and tricky contract terms to make their plans look cheaper than they really are. So, how do you make the right choice? Here’s what to look for:
Many plans on Power to Choose highlight an ultra-low rate, but those numbers are often based on specific usage levels (like 2,000 kWh per month). If your usage is different, your actual rate could be much higher.
Pro Tip: Always check the Electricity Facts Label (EFL) before signing up for a plan. This document breaks down the real cost of electricity at different usage levels.
Some providers use marketing tricks to rank higher on Power to Choose. These include:
Not all electricity providers are created equal. Some are well-established companies with good customer service, while others lure customers in with deceptive pricing and then hit them with unexpected fees.
The Power to Choose rating system only uses formal complaints to determine a provider's number of customers. It does not accurately measure the quality of a provider or plan.
GridHacker Rating and Guarantee: We monitor formal complaints, Google reviews, customer reviews, and the reputation of providers in the industry. On our site, you will only find providers you can trust.
Electricity providers love fine print. Here’s what you need to look out for:
Pro Tip: If a plan seems too good to be true, read the EFL closely—it usually is.
Power to Choose can be useful, but you need to do your homework. Many plans that look like the cheapest option will end up costing you more in the long run. By reading the EFL, avoiding gimmicky plans, and checking provider reputations, you can make a smarter decision and avoid overpaying for electricity.
Electricity plans in Texas aren’t as straightforward as they seem. The rates you see on PowerToChoose.org—or any most sites—often don’t reflect what you’ll actually pay.
Consumers can filter their choices based on criteria such as affordability and green energy options, allowing them to make informed decisions that align with their preferences for sustainable energy sources.
Why? Many plans use complex pricing structures designed to appear cheap upfront but ultimately cost more.
Let’s examine the different types of plans and how the real costs can differ from the advertised ones.
Most electricity plans on Power to Choose advertise a single rate (¢/kWh) based on a set amount of monthly electricity usage—typically 500 kWh, 1,000 kWh, or 2,000 kWh. But here’s the catch:
If you use exactly that amount, you might get the advertised rate.
But if your usage is higher or lower, your actual rate could be significantly different.
According to an EnergyBot study, tricky pricing structures can cause real electricity rates to be up to 45% higher than the advertised rate.
A fixed-rate plan charges the same price per kilowatt-hour (kWh) for the duration of your contract. Your rate stays the same regardless of market changes or seasonal demand.
A fixed-rate plan is usually the safest choice for most households. It provides stability and helps you avoid the hidden costs found in other types of plans.
These plans offer free or discounted electricity during off-peak hours, usually at night or on weekends. However, the price you pay during peak hours is often much higher than a standard fixed-rate plan.
A recent study found that the average customer on a Free Nights & Weekends plan paid over $1,400 more per year than those on a simple fixed-rate plan. Most people cannot shift enough energy use to actually save money with these plans.
A Free Nights & Weekends plan only works if you can shift at least 70% of your energy use to nighttime hours, which is unrealistic for most households.
Bill credit plans give you a discount if you use a certain amount of electricity each month. If you don’t meet the required usage, you lose the credit and end up paying a much higher rate.
An analysis found that bill credit plans were often among the most expensive options for customers who didn’t perfectly match the required usage range.
These plans might work for homes that always use the same amount of electricity, but for most consumers, they create unpredictable bills.
For most households, a fixed-rate plan is the best option. It offers price stability, no usage gimmicks, and fewer surprises on your bill.
Plans like Free Nights & Weekends and Bill Credit sound appealing, but they often cost more in practice. Unless you have a predictable energy usage pattern that perfectly aligns with their rules, these plans can lead to higher costs.
Switching electricity plans might seem daunting, but it can be a straightforward process if you know what to look for. Here are some key factors to consider before making the switch:
By keeping these factors in mind, you can make an informed decision when switching electricity plans. Always read the fine print and ask questions before signing up for a new plan. With the right energy provider and plan, you can save money and enjoy better customer service.
Choosing the right electricity plan is only part of the equation. The other half is managing your energy usage to keep your monthly bills as low as possible. In Texas, where high summer temperatures drive up electricity demand, smart energy habits can make a big difference.
Here are some quick, effective ways to reduce your electricity consumption and save money:
For more in-depth energy-saving strategies, check out this guide from GridHacker.
By combining the right electricity plan with smart energy habits, you can maximize savings and keep your electricity bill under control.
If you’re a business owner in Texas, you might assume you can use Power to Choose to shop for an electricity plan, just like residential customers. Unfortunately, PowerToChoose.org does not offer plans or rates for businesses. The platform is strictly for residential electricity shopping, leaving business owners without a state-run option to compare commercial energy rates.
Unlike residential plans, business electricity rates are highly customized based on factors like:
Because of these variables, most business electricity plans aren’t listed with simple price-per-kWh rates online. Instead, commercial energy shopping requires customized quotes from multiple providers to ensure businesses get the best deal.
While Power to Choose doesn’t support businesses, GridHacker.com does. GridHacker allows businesses to:
Compare electricity plans from top providers in a straightforward, transparent way.
Get expert broker guidance at no cost to ensure you choose the right plan.
Receive custom pricing based on your business’s unique energy usage and needs.
With no fees and no obligation, business owners can get a clear, unbiased look at their electricity options while benefiting from expert support.
If you own a business in Texas and need an electricity plan, Power to Choose won’t help—but GridHacker.com will. Visit GridHacker.com to compare plans and get expert advice today.
