If you live in Texas, you’re in one of the few U.S. states that allows consumers to choose their electricity provider. This deregulated market gives you the freedom to shop around for the best rates, terms, and customer service. But with so many retail electric providers, such as CleanSky Energy, Reliant or Direct Energy, offering dozens of different types of plans, switching can feel overwhelming.
Whether you’re looking to save money, go green, or escape a bad experience with your current provider, switching electricity providers is easier than you think.
Here’s everything you need to know about how to switch electricity providers in Texas, including a detailed step-by-step process, common pitfalls to avoid, and insider tips to make your transition smooth and cost-effective.
Why You Can Switch Electricity Providers in Texas
Since the deregulation of the Texas electricity market in 2002, most Texans have had the power to choose their provider. This competition among electricity companies is designed to drive innovation, lower prices, and improve customer service.
However, not every area of Texas is deregulated. Some cities, such as Austin, San Antonio, and El Paso, still have municipally-owned utilities, and customers in those areas cannot switch providers.
If you’re unsure whether your area is deregulated, you can check your ZIP code on the homepage of our site under “Find a Plan”.
Step 1: Know Your Current Electricity Usage
Before you start comparing plans, review your electricity usage patterns. This helps you find a plan that matches your needs and prevents costly surprises.
Tips:
- Check your last 12 months of electricity bills. If usage isn’t available on your bill, you can always visit Smart Meter Texas to check your usage levels.
- Look at your average monthly kilowatt-hour (kWh) usage.
- Pay attention to seasonal highs and lows.
Several plans offer different pricing tiers depending on how much electricity you use, so knowing your usage helps you avoid plans that might look cheap but charge a much higher rate at your usage level.
Step 2: Check Your Current Contract
Before you switch, understand the terms of your current contract. Leaving early could mean paying an early termination fee (ETF), which could range anywhere from a flat fee to a set dollar amount per month left on your contract.
There are two documents in your provider’s online portal (if they have one) you can reference, which are an Electricity Facts Label (EFL) and your current bill. These will clearly state the information you will need to make an informed decision about switching, which includes:
- Contract end date
- Cancellation fee
- Auto-renewal clauses
All Texas retail electricity providers are required to allow you to switch within 14 days of your contract’s end without penalty.
Step 3: Compare Plans
Now comes the fun part: shopping for a better deal.
What to Look For in a Plan:
- Price per kWh:
Don’t just go for the lowest advertised rate. Make sure the price aligns with your actual usage, as many plans charge different rates for different usage levels. - Fixed vs. Variable Rates:
- Fixed-rate plans lock in your rate for the contract term.
- Variable-rate plans have rates that fluctuate with the market, which can be risky during high-demand periods. However, these plans typically offer more flexibility if you need a shorter term or are uncertain about how long you will need to be on an electricity plan.
- Term Length:
Contracts often range from 3 to 36 months. Longer terms offer price stability, but shorter terms may offer flexibility and a more attractive introductory rate. - Renewable Energy:
Some providers offer 100% renewable electricity plans powered by wind or solar. - Hidden Fees:
Watch for:
- Minimum usage fees
- Monthly base charges
- Meter fees
- Early termination fees
Read the Electricity Facts Label (EFL) for every plan before you make a decision. It will detail out everything listed above, from rates at each usage, fees from the utility, term length, cancellation terms and more. This will help you make a more accurate decision when deciding between different plans offered by different providers.
Step 4: Sign Up for a New Plan
Once you’ve chosen a plan, you can sign up online or call the provider. You’ll need to provide:
- Name and contact information
- Service address
- Preferred start date
- Social Security number or driver’s license for identity verification
Can I Choose the Start Date for My Electricity Plan?
You can schedule your switch up to 14 days before your contract ends without an ETF.
Your new electricity provider will handle the switch for you, with no interruption to your electricity service. There’s no need to contact your current provider, and you won’t need to install new equipment or have someone visit your home.
Step 5: Confirm the Switch and Monitor Your Bills
After enrolling, you’ll receive a confirmation email or letter. Your new provider should also send you a Terms of Service and a Your Rights as a Customer disclosure.
What Happens Next?
- Your new provider will notify your utility company (called the Transmission and Distribution Utility or TDU). In Texas, this is Centerpoint, Oncor, Texas New Mexico Power, AEP Texas North, AEP Texas Central or Lubbock Power & Lighting.
- Your old provider will issue a final bill.
- Your new service will begin on your chosen date, usually within 7 business days or on your next meter reading cycle.
Make sure to track your first few bills to ensure the rate you signed up for matches what you’re being charged.
Avoid These Common Mistakes
Even in a deregulated market, some consumers fall into traps. Here’s what to watch out for:
Don’t Fall for “Teaser” Rates
Some plans advertise low rates based on specific usage levels (like 1,000 kWh/month), but if you use more or less than that, your effective rate could be much higher.
Don’t Ignore the EFL
The Electricity Facts Label tells the real story about rates, fees, and terms. Read it before committing. This helps you compare plans in the most equitable way possible.
Don’t Wait Until the Last Minute
If you wait too long, you could get rolled into a month-to-month variable plan at a high rate.
Don’t Automatically Renew
REPs may automatically renew you at a less competitive rate. Always review your contract near its end and shop around.
Can I Get Electricity with Bad Credit in Texas?
CleanSky Energy requires a credit check and may ask for a deposit.
There are other REPs in Texas that offer a no-deposit electricity plan or a pre-paid electricity plan, where you pay in advance and track usage in real-time.
Can I Switch Providers as a Renter?
If you’re renting, switching is still possible. It would be good practice to check your lease for:
- Restrictions on utility providers
- Coordination with your landlord (if utilities are bundled with rent)
You may also want a month-to-month or short-term plan if your lease is less than a year.
Switching to a Green Energy Plan
Want to reduce your carbon footprint? Texas is a leader in wind energy, and many providers offer 100% renewable plans at competitive rates.
Look for plans that specify “100% renewable content” on their EFL.
Take Control of Your Electricity Costs
Switching electricity providers in Texas is one of the easiest ways to reduce your monthly expenses and take control of your energy consumption. With a little research and the right timing, you can find a plan that fits your lifestyle, budget, and values.
So don’t settle for high rates or poor service. Shop smart, read the fine print, and make your power work for you.
