Transmission and Distribution Service Provider Charges

Transmission and Distribution Service Provider Charges (TDSP)

Texas electricity consumers often go out and receive quotes from several retail electric providers and notice that there is an additional charge that is not quoted with the energy rate. The TDSP charges or what are sometimes known as pass thru charges are left off of the rate. This can appear a little shady as if the energy supplier is purposefully trying to make their electric rate look better then it actually is.

TDSP charges are not your electric rate?

What is actually going on when the electricity provider leaves the TDSP charges from the energy quote? They are not trying to trick the customer. Texas deregulated the energy market in Texas back in 2002 and when they did this they unbundled the energy rate. The energy provider prior to 2002 was also the pole and wires company. That means the TDSP charges and energy rate were owned and charged by one company prior to 2002. When deregulation occurred the Texas government with the oversight of the Public Utility Commission split up the former monopolies such as TXU Energy, First Choice Power, Reliant and others and created seperate companies. Now you have over 40 Retail Electric Providers to choose from and only a few pole and wires companies. In fact for your region you only have one choice for who you pay your TDSP charges to. In the Dallas area you would pay TXU now known as Oncor http://www.oncorgroup.com. This TDSP charge will show up on your energy bill the same regardless of which Retail Electric Provider you choose. This TDSP charge is simply past on to you from Oncor directly to your energy bill. The TDSP charge can be anywhere from 1 – 8 cents a kilowatt hour and sometimes more. In order to find out exactly how much you pay the pole and wires company you would need to call them and ask for your historical usage. This data will show you exactly how much you pay in TDSP charges for each month along with the corresponding kwh usage for the month.

Electric Providers are showing several different estimates for my TDSP charges

The reason electric providers are giving you an energy quote with an estimate that is not the same as another providers estimate is because they can only guess as to what exactly you may pay for next year. The TDSP charges are figured based on a Public Utility Commission of Texas Rule that is complex and changing. The TDSP charge also changes based on the amount of usage used. Because of these variables you may see several different Transmission and Distribution estimates. The important thing to remember is that these are not quotes but only a helpful estimate to consider so you will know what the total charges would look like. In the end you will pay the same TDSP charges regardless of which electricity provider you choose. Note: It is still not illegal for Texas electricity providers to secretly mark up the TDSP charges with their profit margin and hide this fact in the fine details of the contract. Electricity Bid does not work with any Texas electric companies that do this practice although they are still out there.

For more information about these charges please speak to a Texas energy consultant to learn more. You can speak with a consultant from Electricity Bid by calling 1-800-971-4020

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