Houston Texas Residential Electricity Rates


Over 200 Electric Rate Plans

Houston Texas has over 200 different residential electric plans to choose from. That being said, what is the best plan and are their similarities between one electric provider and another?

  • There are several similarities with fixed price rate plans. Most electric providers offer fixed rate plans for 12, 24, and 36 month residential service plans. The reason the plans are pretty much the same is because they all are hedged energy bought from Natural Gas futures. The energy plans will even be tiered in the same price level. For instance, a 36 month natural gas contract is a higher price right now then a 12 month natural gas contract. Because the 36 month contract is higher the 36 month electric contract is higher then the 12 month contract. You see, the provider has to charge more for a longer term because they bought the energy for more. It is not the same as when signing up for a long term cell phone contract. The same market factors do not apply.

  • Something to watch out for when comparing fixed energy rate plans is the monthly customer service charge. Some charge anywhere between $4.95 a month all the way up to $15.00 a month for you agreeing to be their customer. It doesn’t make much since but many providers do this. This monthly charge can easily eat up any savings in the rate you perceive there to be. Go for a fixed energy rate that has no monthly service charge and do the math to see if you will save more over the companies that charge the fee. Often times you will never save more with the electric companies in Texas that tag on the customer service charge.


Not So Clear Rate Plan

In Houston Texas there is an electric company that has been covering the radio air waves and billboards promising to offer a cheap electric rate for residential customers. This electric company goes by the name of Texas Power. I went out to powertochoose to see what their rate is and discovered it wasn’t that great. I looked at the facts label which is the criteria you use to compare rate plans with each other and discovered that it was from July 3. So the info on powertochoose was a little but outdated. I then went on their website. At first appeared that the rate was no where on their site. I then saw the rate to the right at 11.9 cents kwh. It didn’t give any details other then this rate, I wanted to know more. I went ahead and gave them my information in the site form believing after filling the form out they would show me a quoted rate. Instead I received a statement saying I needed to provide some financial data in order to go through the credit check. I still have not received a rate quote and they are requesting I start the sign up process? This company seems to be going about things backwards. I think they believe that by saying cheap on the radio and then providing a form on the internet to sign up they will get a stream of residential electric customers. I am very skeptical and have yet to receive a rate quote. I will be calling them today to see if they will go ahead and tell me their rate but I have a feeling it won’t be that easy.

I called them today (Sept 19 2007). I discovered the rate is not an introductory rate but it does follow the natural gas market. Natural gas is at a 2 year low right now. The electric rate could easily be at 12 – 13 cents kwh if natural gas trades back up in the $7 – $8 MMBtu range. This would be a sticker shock on most residential customer bills if the rate were to dramtically shift like this. I would stay away from the variable rate as most people will not be happy when their bill goes up $50 – $100 more because of a natural gas swing. To view natural gas prices you can go to www.nymex.com and click on NG. They also told me that unless you use 1,000 kwh of energy or more you will have to pay a $10 a month monthly customer service fee. This is a lot and if you use less energy then this then any savings you receive from the rate will be completely eaten up by this monthly charge.

Not all electric providers make it hard to determine their rate.

Several electric providers will show you their electric rate if you will just enter your zipcode for your area in Texas you live in. Several rate terms will come up and the monthly rate and charges are clear and straightforward. If you get anything other then clear and straight forward it would be my recommendation to stay away. The company may be trying to scam you through clever marketing campaigns. Although a clever marketing campaign may be legal it is definitely not ethical.

Some of the electric companies in Houston that have a clear presentation of what you are getting into on their website are:

Good Fixed Rate Plans:
We offer a comparison of several great fixed rate terms through the use of our compare tool at the top right on this page. The rates are compared side by side and you can see how long the term is and other useful details. The tool allows you to order the electricity service from the provider of your choice when your ready to do so.

Good Variable Rate Plans:
In order to pick a good variable rate plan you have to read the details about the plan on each and every plan otherwise you will end up falling for an offer that looks better than the rest but comes with a catch. Most of these plans stay low for one or two months and then they go sky high on you. When reviewing variable plans see if they come with a cap that does not allow the rate to go beyond a certain level. Make sure there is no long term commitment you must sign with a variable plan. And finally, if at all possible go with a short term fixed rate plan just so you avoid teh possibility of getting burned on a variable plan all together.


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