Texas electricity is deregulated in most areas, meaning you choose your retail electric provider instead of having one assigned to you

In most of Texas, you do not have a single electric company. Instead, you have a choice between dozens of retail electric providers (REPs) that buy power from the grid and resell it to you. The grid itself and the wires to your home are still run by a regulated utility company — but that company does not sell you the electricity. This setup exists in the deregulated areas served by ERCOT (Electric Reliability Council of Texas), which covers most of the state except for parts of East Texas, the Panhandle, and far West Texas.

Outside deregulated areas, you have one utility company that both owns the grid and sells you power. Those utilities are regulated by the Public Utility Commission of Texas and operate under traditional monopoly rules. Knowing which system serves your address matters because it changes how you shop for service, how you pay, and who to contact when something goes wrong.

Key Takeaways

  • Most of Texas lets you choose your electric provider, but some areas have only one utility company — check your address on the ERCOT map to know which applies to you.
  • In deregulated areas, you pay two separate bills: one to your retail provider for electricity and one to the utility company for delivery and grid maintenance.
  • Retail providers offer fixed-rate plans (price stays the same for a set period) and variable-rate plans (price changes monthly), so comparing them before you switch matters.
  • If you have a problem with your bill or service, contact your retail provider first; if they do not fix it, the Public Utility Commission handles complaints.

Deregulated areas: choosing your own provider and understanding two bills

If you live in a deregulated area, you receive two separate bills each month. One comes from your retail electric provider (the company you chose to buy power from), and one comes from your transmission and distribution utility (the company that owns the poles, wires, and transformers). The utility bill includes delivery charges, system maintenance, and taxes — costs that do not change based on which provider you pick. The provider bill shows your electricity rate, which varies widely depending on the plan you chose and market conditions.

When you move to a new address in a deregulated area, you are not automatically assigned a provider. You must choose one yourself, or the utility will place you on a default provider at a higher rate. You can switch providers at any time with no penalty, though some plans charge a small fee if you leave before the contract ends. Switching takes about two weeks and does not interrupt your service.

Deregulated providers compete on price, contract length, and perks like renewable energy options or bill credits. Some offer fixed rates (your price per kilowatt-hour stays the same for 6, 12, or 24 months), while others offer variable rates that change monthly based on wholesale market prices. Fixed rates are easier to budget for; variable rates can be cheaper some months and more expensive others.

Regulated areas: one utility company handles everything

In regulated areas outside ERCOT's footprint, you have one electric utility and no choice of provider. That utility owns the generation, transmission, distribution, and billing. You receive one bill that covers all of it. Rates are set by the Public Utility Commission and change only when the utility files for a rate increase, which requires a public hearing and approval.

Regulated utilities include Oncor (serves North Texas, parts of Central Texas, and the Panhandle), CenterPoint Energy (serves parts of East Texas), and El Paso Electric (serves far West Texas). If you live in one of these service areas, you contact that utility directly for service, billing questions, and outages. You cannot switch providers.

How to find out which system serves your address

The fastest way to know whether you can choose a provider is to enter your address on the ERCOT website's service territory map. ERCOT maintains a searchable map that shows deregulated areas in blue. If your address appears in blue, you are in a deregulated area and can shop for providers. If it does not appear on the map, you are in a regulated area.

You can also call your current utility and ask whether you can choose a retail provider. If the answer is yes, you are deregulated. If the answer is no, you are regulated. Your current bill also shows this: if you see two separate charges (one for energy, one for delivery), you are deregulated; if you see one combined charge, you are regulated.

Shopping for a provider in deregulated areas

Several websites let you compare providers and rates for your address. The most widely used are PowerToChoose.org (run by the Public Utility Commission) and EnergySage. Both let you enter your address and see all available plans, rates, contract lengths, and terms. You can filter by fixed versus variable rate, renewable energy options, or lowest price.

When comparing plans, look at the total monthly cost, not just the rate per kilowatt-hour. A plan with a lower rate might have higher fees or require a longer contract. Read the contract terms carefully — some plans charge an early termination fee if you cancel before the contract ends, while others do not. Check whether the rate includes all taxes and fees or if those are added later.

Once you choose a plan, you can sign up online or by phone. The provider handles the switch with your utility company; you do not need to contact the utility yourself. Your service continues uninterrupted during the switch, which usually takes 7 to 14 days to complete.

Understanding your bill and what each charge means

In deregulated areas, your provider bill shows your kilowatt-hour usage and the rate you are paying per unit. It also shows any monthly fees (some providers charge a small administrative fee) and any credits or discounts you have. Your utility bill shows delivery charges, which include the cost to maintain the grid, taxes, and any riders (additional charges for specific programs like low-income information or renewable energy infrastructure).

Both bills show your meter number and billing period. If you notice an unusually high bill, check your usage first — weather, new appliances, or a change in habits can raise consumption. If usage looks normal but the rate seems wrong, contact your provider to verify the plan you are on. If you are in a regulated area and your bill seems high, contact your utility; they can explain the charges and tell you whether a rate increase has taken effect.

What to do if you have a problem with your service or bill

In deregulated areas, contact your retail provider first for billing disputes, rate questions, or service issues like a meter problem. Providers are required to respond to complaints within a set timeframe. If your provider does not resolve the issue, you can file a complaint with the Public Utility Commission of Texas. The PUC has a consumer complaint form on its website and a phone line for questions.

For outages or downed power lines, always contact your transmission and distribution utility (the company that owns the wires), not your provider. Outages are a utility responsibility. In regulated areas, contact your utility for any issue — billing, service, or outages.

The PUC also handles complaints about deceptive marketing or contract terms. If a provider misrepresented a plan or locked you into a contract you did not understand, the PUC can investigate. Keep copies of all emails, contracts, and bills when you file a complaint.

Frequently Asked Questions

Can I switch providers if I am in the middle of a contract?

Yes, but you may owe an early termination fee if your contract specifies one. The fee amount is in your contract terms. Some providers waive the fee if you switch to a plan with them. Before switching, calculate whether the savings from a new provider outweigh the termination fee.

What happens to my service if I do not choose a provider in a deregulated area?

Your utility will assign you to a default provider, usually at a higher rate than you would pay if you shopped yourself. You can switch away from the default provider at any time. It is worth shopping even if you have been on the default for months or years.

Do I have to use a renewable energy plan?

No. Renewable plans cost more per kilowatt-hour but source some or all of your power from wind or solar. Standard plans use the grid mix, which includes fossil fuels, nuclear, and renewables. You choose based on your budget and preferences.

What if my provider goes out of business?

Your service does not stop. The utility continues to deliver power, and you are automatically moved to another provider. You will receive notice of the switch and your new rate. This has happened several times in Texas, and customers have never lost power because of a provider failure.

How often can I switch providers?

You can switch as often as you want in deregulated areas, though most people switch once or twice a year when rates change or contracts end. Each switch takes about two weeks. There is no limit on the number of switches you can make.