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Regardless of the provider you choose they all must pass thru the exact same fees from Oncor. This is a matter of legality. The Pole company can show no partiality to any provider in retail competition in Texas but must pass through the rate as approved by the Public Utility Commission of Texas. This TDSP charge will always be the same regardless of the provider as there can be no partiality given based on provider.

Reading from the PUC website you can read for yourself similar language as I have described.

“Transmission and Distribution Utilities (TDUs) must offer access to their wires to all REPs on a non-discriminatory basis under standard terms and conditions adopted by the Commission.”

“These areas are open to full retail competition as of January 1, 2002, and these TDUs charge the below rates to REPs.”

To see the rates in the Oncor area of Texas click here

The reason this topic has been brought up on this blog is due to the large amount of sales people out there that use the TDSP part of the bill to confuse customers about their rate in order to get them to switch providers.

You may hear from a retail electric provider sales person that their company does not charge the TDSP charge or that it is much lower than another provider.

Statements like the one above are lies and deceptions geared to getting you to believe a given rate from a new provider is cheaper than the one you have.

There are cheaper providers out there so shopping around is a good thing. When the cheaper rate being discussed is only cheaper because they argue regarding the TDSP part of the rate then take notice because you are about to be had.

Where this deception is most often encountered is through door to door sales people, responding to a newspaper ad in a thrift paper by calling number on ad, or via MLM sales people that may be regurgitating information they themselves do not fully understand.

However you heard about a cheaper rate by getting a lower TDSP charge this is very false information and by no means believe it. These people are either lieing or they have been led to believe something false and are now sending you down their gullible road.

In summary this article was written to help those navigate down a typical issue encountered when choosing an electric rate. If you have further questions please call or use our compare widget.

If you have an electric company calling you and sending you mail outs asking you to renew an expiring fixed rate contract you are likely benefiting.

Most people get their highest electric bill after they let their contract expire and the rate defaults to a variable market rate.

The variable prices are not hedged rates and so the provider is taking on a significant risk by selling a price that is not locked in.

The provider can eliminate this risk by adding in their profit margin and allowing the price increase that may happen to roll over to the customer.

Market electric rates can sometimes be lower than what you could sign up on with a fixed rate but an electric provider is unlikely to give you these savings if you did not renew your contract.

What they will do instead is give themselves an added 2 cents or more per kWh added to the existing profit margin.

So you may have had a significantly cheaper electric bill over past years while on a 1 year fixed contract.

Your electric bill might have been under $100 a month but as soon as that contract expired your rate went to a variable price and you racked up almost 2 months of usage on a higher electric rate and perhaps had a $200 plus electric bill for the two months you were off contract.

An electric provider that gave you an excellent deal in the beginning may have hoped a certain percentage of their customers would allow their contract to lapse so they could meet their profit target.

This is a warning to procrastinators. Don’t let your electric service contract expire without renewing with the same provider or shopping and ordering with a cheaper provider.

The providers would hope you will let it slide but it’s not a smart move for a family budget that needs to stay on target.

In summary, let me suggest a way to avoid the electric rate price uptick by setting an alarm to ring on your phone around the date of your contract expiration. Make a committment to shop and order electric service when that alarm sounds so you don’t pay $200 – $400 more for electricity than you really needed to.