How Electricity Prices Work in Texas

Electricity prices in Texas are ever-changing. They rise and fall depending on what time of year it is and how the economy is faring. Because of how volatile electricity prices are, it’s important to sign up for an electricity plan with a reliable company that isn’t going to unexpectedly jack up your monthly rates. 

In this article, we’ll look at how electricity prices work in Texas. We’ll also look at how to choose the best electricity company and who to turn to for long-term savings and peace of mind. 

How Are Electricity Prices Determined in Texas? 
  1. What are the Average Electricity Prices in Texas? 
  2. Are Electricity Prices the Most Important Factor When Choosing a REP? 
  3. Why Are There So Many Different Electricity Prices in Texas? 
  4. Which REP Has the Best Electricity Prices and Perks in Texas? 

How Are Electricity Prices Determined in Texas?

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Why Are There So Many Different Electricity Prices in Texas? 

Texas is one of several states in the country that has deregulated electricity. Deregulation happened in the early 2000s and led to the electricity market in Texas getting turned into a competitive business. Deregulation exists in roughly 80% of Texas and affects many of the largest cities in the state including Dallas, Houston, Fort Worth, Corpus Christi, and many more. 

Because electricity is essentially a good to be bought and sold, electricity prices are very unstable. Private companies, known as REPs, can technically charge whatever they want for electricity. However, the sheer amount of REPs that operate in Texas creates a competitive market that keeps electricity prices reasonably low.  

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What are the Average Electricity Prices in Texas? 

While it’s common for Texas residents to complain about high electricity prices, our rates are actually lower than most of the nation. The current average electricity price in Texas is 12.8 cents/kWh. While this is the average electricity price, rates can range from 7 cents all the way up to 26 cents. It’s important to understand the terms and conditions of your electricity plan so that you can end up on the low end of the spectrum. 

How Are Electricity Prices Determined in Texas? 

Although deregulation allows retail electric providers to establish whatever prices they desire, there are a few additional factors that affect their price choice. 

Which REP Has the Best Electricity Prices and Perks in Texas?

Time of Year 

Electricity prices are fairly volatile and unpredictable in Texas, there’s often a rhyme and a reason to the madness. For example, you can pretty much bet that your monthly bill will be higher in the summer months than any other time of year. Winter is a close second in terms of sky-high electricity prices, especially if you use electricity as your source of heat. 

The reason that rates are higher during these parts of the year is that electricity is in higher demand. Electricity is a good that’s bought and sold by private companies in Texas, which means that supply and demand play a significant role in the pricing. When people need electricity in a bad way, companies can afford to raise their prices. 

Power Generating Sources

Another factor that affects supply and demand with electricity and, in turn, affects the price, is how readily available it is. Retail electric providers, such as GoodCharlie Energy, don’t actually create the electricity that we sell to you. Instead, REPs purchase electricity from power generating plants at wholesale value and sell it to residential and commercial customers at resale value. 

Therefore, the more power generating plants there are, the more electricity is available in a certain area. If there’s a surplus of electricity, REPs don’t have to pay as much to purchase it and can sell it to you for a lower price. However, if there are fewer power-generating plants in an area, electricity prices will be higher because it will cost REPs more to purchase electricity in the first place. 

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Fuel and Production Costs 

The final major factor that has an impact on electricity prices in Texas is how expensive it is to create. Most of the electricity in Texas comes from fossil fuels such as coal and natural gas. It also gets created out of nuclear power, wind power, and solar power. While wind and solar power are examples of renewable resources, fossil fuels and nuclear power aren't. 

So, the more expensive it is for power generating plants to purchase fossil fuels and convert them into electricity, the more expensive it will be for REPs to purchase said electricity.   

Are Electricity Prices the Most Important Factor When Choosing a REP? 

  • Reputation and Integrity


While electricity prices play a significant role in choosing an REP, they don’t play the only role. You should also take the reputation and integrity of the company into consideration. There are more than 120 REPs in Texas, and many of them aren’t known for their high integrity and outstanding customer service. 

Obstacles and Pitfalls 

You should also dig into the details of any electricity plan you’re thinking about signing up for. Be on the lookout for hidden fees, tiered rates, and other obstacles that will elevate your monthly electricity rate. 

Perks and Benefits

Finally, you should also look at the list of perks and benefits that are offered with your electricity plan in question. Perks and benefits are a great way to offset high electricity prices and to make sure you get your money's worth.

How Electricity Prices Work in Texas 

Which REP Has the Best Electricity Prices and Perks in Texas? 

As with most things, the best electricity prices are typically offered by the best companies, which are REPs with your interests in mind rather than just their own. GoodCharlie Energy is one of those few companies. While we might be a new REP, we have years of experience in the world of Texas electricity. We also have the mission of looking out, not just for you but for every member of your household, including your dogs. 

In fact, we offer our customers a pet emergency fund, 24/7 vet video access, and a promise to support local shelters. Our goal is to provide you with the best electricity rates and service in Texas and make sure that dogs in Texas are safe and cared for. If you want the best electricity rates in Texas and care about dogs as much as we do, look no further than GoodCharlie Energy. 


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