How to Read Your Texas Electricity Bill
Learn how to understand what’s included on your electric bill.
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Understanding your Texas electricity bill
Many Texas energy customers easily get lost in the details of their monthly electric bill. Between TDU charges, termination fees, usage tiers, and bill credits, you can quickly lose sight of what you owe and why.
Fortunately, Choose Texas Power is here to help clear up the confusion with your Texas electric bill. Using a sample monthly bill, we’ll break down each section so you can confidently understand your charges and tackle your energy consumption.
Although your electric bill may vary slightly by provider, the core details should still apply.
Key terms on your Texas utility bill
kWh (Kilowatt-hour): This is the standard unit of measurement for electricity consumption. One kWh is equal to using 1,000 watts of energy for an hour. Every device and appliance in your home that uses electricity contributes to your total kWh consumption.
Retail energy provider (REP): REPs, also known as electricity providers or electricity companies, sell energy plans to consumers, manage your electric account, and handle your monthly billing. In deregulated cities, you can select your energy provider.
TDU, UDC, or TDSP delivery charge: This is the fee from your utility company (separate from your provider) for the cost of transporting electricity from the power plant to your home or business. It varies by utility company and location.
Public Utility Commission of Texas (PUCT): This state agency regulates all utilities in Texas. Most notably, the PUCT regulates energy costs to ensure fair pricing for Texas energy consumers.
PUC assessment: The PUCT charges utility companies a fee to service each customer’s address. This fee is passed on to customers in their monthly light bill.
Gross Receipts Tax Reimbursement: REPs are charged a Miscellaneous Gross Receipts Tax for operating in an incorporated city. Providers may pass this fee through to consumers via the Gross Receipts Tax Reimbursement.
Bill or usage credit: A bill credit is a discount on your total bill when you use a certain amount of electricity during that billing cycle. For instance, you might earn a $50 credit for using at least 1,000 kWh. Not all plans have bill credits; you should read your plan’s Electricity Facts Label (EFL) to learn if your plan has one.
How to avoid common energy bill mistakes
If you‘re surprised by how much you owe on your monthly electric bill, you’re not alone. The average electric bill in Texas contains many components, and it’s easy to misinterpret the EFL and end up with a confusing bill.
To help prevent misunderstandings, we asked our experts for advice on avoiding unwanted surprises on your bill. Keep these tips in mind when picking your next energy plan.
Read the fine print
No one loves reading the fine print, but understanding your EFL can help you avoid confusion when you receive your bill. It’s important to know your plan’s pricing structures and usage requirements, because customers often misunderstand bill credit terms.
For example, this Gexa Eco Saver Plus 12 plan includes a $125 bill credit for using at least 1,000 kWh of electricity each month, resulting in an average price of 8.6 cents per kWh. However, if you use less than 1,000 kWh, your average price is actually 21.5 cents per kWh.
Budget for taxes and TDU charges
On top of your energy charge, you have to pay taxes and delivery fees. Many consumers forget to budget for these additional charges and are frustrated when their light bill is higher than expected. Our energy experts recommend creating an energy budget after you’ve received a couple of bills and you have a better idea of your total energy costs. This way, you can build an accurate budget for your monthly energy bills.
Carefully consider free usage periods
When shopping for an energy plan, it’s best to choose one that already matches your energy habits, rather than changing your habits to match a plan. This advice especially applies to time-of-use plans that offer free usage periods. Most time-of-use plans offer free energy at night (and higher rates during the day), which could be a great opportunity to save if you use most of your energy during those hours. However, this may not be a great fit for those who work from home or use most of their energy throughout the day.
Choose Texas Power is here to help
If you are struggling to determine which plan is best for you or have questions about an EFL, call our team at the number on your screen. Our experts can simplify the energy shopping experience and help you navigate the deregulated energy market with ease.
Texas electric bills FAQs
How do I pay my electricity bill?
Every provider offers different payment options, but most usually allow you to pay online, by mail, over the phone, or in person. Many also offer an autopay option so you can avoid late fees. Your bill should explain various payment methods.
Why is my electric bill so high?
The majority of your electric bill costs are related to your energy usage. If you notice a sudden uptick in your bill, it is likely because your usage increased. If consumption isn’t the issue, you may be surprised by utility charges, taxes, or some other element of your bill.
How can I lower my electric bill?
You can reduce your energy usage with simple steps like switching to LED bulbs, lowering your water heater temperature, and using fans or curtains to ease the load on your HVAC system. Larger investments also help, such as installing a smart thermostat, upgrading to energy-efficient appliances, or adding renewable energy solutions.
What is the average electric bill in Texas?
The typical Texas household currently pays $133.60 per month for electricity, according to our latest marketplace data. However, your exact cost will vary depending on your rate, local utility charges, household size, usage level, and more.
Why does my electricity bill include delivery charges?
Delivery charges cover the cost of maintaining power lines, poles, and other infrastructure that transport electricity to your home. These fees are set by your local utility, not your retail energy provider. They are the same no matter which electricity company you choose.
