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These live rates for (TDSP) service area were updated on (May 27, 2020 at 8:15 AM CST). Pricing shown is based on an exact usage of 1000 kWh.


Every summer, most Houstonians start to look for cheaper deals by switching electric companies in Texas. As the temperatures rise, homeowners and entrepreneurs begin to consume more power to fulfill their residential and commercial needs.

The August heatwave that gripped the state of Texas in 2019 caused the wholesale electricity rates to soar higher even as the country’s prices fell. While the average annual prices decreased by 15-30% last year, the maximum power price in Texas was $9,000 per MWh.

With a hot summer comes a nationwide peak in electricity demand, which usually means a significant drop in energy prices. With deregulated energy markets in many states, light companies can compete for low electricity rates to cater to the growing needs of the people.

But this might change in 2020. The ERCOT (Electric Reliability Council of Texas) predicts that the sector domination goes to renewable energy sources from traditional power generation methods.

In 2019, for the first time in Texas’ energy industry, wind energy exceeded coal production. The grid statistics represent credible growth in wind energy generation from 7.8% in 2010.

Houston homes and businesses can significantly benefit from the estimated low prices due to the developments in the renewables sector, especially in wind and solar electricity generation projects.

So, why wait? Compare light companies rates today to save money this summer. Find the best electric company in Houston with our simple tool.

Power to Choose

Retail Electricity Provider in Houston

Per the reports of the Public Utility Commission of Texas (PUCT), by 2016, 92% of electricity customers had used their right to switch energy providers at least once.

Free Market Competition

The Texas deregulation system encourages free-market competition, allowing several energy providers to offer their customers low electrical rates.

Houston Electric Choice

Houstonians have the power to choose alternative electric providers since 2002. They can compare electricity rates and select a plan.

Transmission and Distribution Utility

The TDUs (Transmission and Distribution Utility) does not hold a market monopoly anymore. CenterPoint Energy, TDU for greater Houston area, can now only generate power and maintain the electric transmission infrastructure.

Retail Electric Providers

Retail electric providers (REPs) are those energy companies from which you purchase electricity directly. Regardless of which low rate energy companies you choose, you will get a safe and reliable power delivered by your TDU.

Retail Electricity Rates

Houston Retail Electricity Rates May Drop Despite High Wholesale Prices

The wholesale price for the electricity market usually soars during peak summer demand, particularly in the afternoons or early evenings. This cost reflects the real-time electricity supply price.

When you compare energy rates, retail electricity costs depend on factors, such as:

Typically, retail rates are higher than Texas wholesale electricity prices.

Retail Electricity Price Drop
During last year's extraordinary demand due to the heatwave, the real-time wholesale market price soared along with the high temperatures. However, the retail electricity rates in Houston had dropped.

This is because most consumers opt for energy plans based on their average electricity usage. On the other hand, consumers who chose their energy plans based on wholesale electricity prices had to pay more.

Most energy providers design best electricity rates Houston only for 1000 kWh of average usage. And your electricity bill will drastically enhance if your energy consumption is more than that level. So, it is crucial to compare electricity rates and select one that fits your average requirement.

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Energy Infrastructure Challenges

The peak electricity demand of 2019 to power cooling equipment soared to a 704 GW requirement, while two years ago, it peaked at 718 GW. By 6:00 p.m. on July 16, it was much lower than the grid operator-predicted 748 GW.

When the triple-digit temperatures had dropped by July 23, there was a general decrease in the demand for power. With a subsided hourly peak value at 589 GW, it stayed within the expectations for a typical summer day.

To meet the hourly power demand in summer 2019, more generators had to operate continuously to dispatch additional power to adjacent grids.

Consumers need access to cheap and reliable energy. Recent surveys are a testament to the fact that more and more consumers now demand 100% clean electricity.

Currently, 2.4% of nationally generated electricity comes from solar.

Although Texas has the most substantial coal consumption in the country, it has been steadily scaling up its solar and wind farms, which are slowly inching towards defeating coal's share in the energy market.

With 13,361 installed wind turbines and many projects in construction, Texas stands no.1 in the country with a capacity of 24,899 MW. Houston, with over 4,600 energy-related companies, is rightly called the Energy Capital of the World. You can explore a variety of low rate electricity companies in Houston.

The high power demands can be met by scaling the alternative energy generation plants, which not only reduce carbon emissions but are also less expensive to operate.

For instance, installing solar panels is much more affordable now as they cost around $0.35/W, with a price reduction of 50% between 2015 and 2019. As per the National Renewable Energy Laboratory (NREL), this decrease is much slower than the 80% decline that we saw from 1980 to 2010.

Between 2010 and 2017, the residential solar energy rates have gone down to 15.1¢ per kWh from a whopping 52¢ per kWh. This consistent cost decline will see a reduction in the electricity rates even in the future.

Texas is a leading state in the renewable energy sector. The state is also known to produce the largest amounts of wind electricity, and over 30 wind energy generating companies operate in Houston.

Green energy Houston can give the consumers significant savings on electricity bills with solar and wind power costing as little as $28 and $15 per MWh, respectively.

Houston Electricity Rates

ERCOT Peak Load Forecast for 2020

The U.S. EIA Reserve Margin is the electricity generating capacity in times of peak power demand. It is the difference in the amounts of power generation capacity and expected demand versus the sum of expected power demand.

ERCOT, the Texas power grid, maintains a reserve margin of 13.7%, which means that the state can generate 13.7% more power than it can use. To ensure power reliability in case of a hotter temperature that is more than expected, ERCOT announced a projected reserve margin of 10.6% for the summer of 2020.

The peak load forecast stands at 76.696 GW, while renewable energy is expected to grow substantially.

Electricity Plans in Houston

Solar and Wind Electricity Plans in Houston

Globally, the current carbon emissions are around 12 billion tons, which see an 8.9 billion-ton projection by 2050. The Texas power sector is committed to reducing its annual greenhouse gas emissions. By cutting down coal and natural gas amounts for power generation and making changes in energy policies, the power sector aims to produce zero-carbon electricity.

In the renewable portfolio, there are plentiful Houston renewable energy companies that offer you green power choice. Texas’s unique climate especially offers its electricity consumers to reap the full range of solar energy benefits.

Compare electricity plans Houston to choose the best green electricity plan for you. Punch in your Zip code and view the available clean energy rate plans that are cheaper than the conventional electricity rates.

Electricity Cost in Houston

How Much Does Electricity Cost in Houston Texas?

Houston electricity costs rose by 17.8% in 2019 when compared to the previous year. Due to the staggering temperatures and peak demand, the costs went up by 1.1% nationwide.
The electricity cost usually depends on your minimum usage amount, bearing a minimum usage charge. This will be mentioned in your chosen plan’s Electricity Facts Label. However, some companies provide cheap electricity no deposit plans that waive this fee.
Electric providers in Houston send you easy-to-read monthly bills unless you have selected a prepaid electric plan. To find the cheapest electric company, you need to know your expected usage and average electricity bills in Houston.

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Average Electricity Bill

Average Electricity Bill in Houston

On average, Texas industrial electricity consumption is 85,264 kWh per month, making the average electricity bill for Houston industrial sector to be the same, around 5.57¢ per kWh.

For commercial needs, the monthly energy usage is 8,185 kWh per month, making the average commercial electric bill in Houston to be at 8.16¢ per kWh.

Houston residential power usage is 1,168 kWh per month on average, making the average electricity bill for Houston residents to be at 10.98¢ per kWh.

Furthermore, an apartment in Houston uses 500 kWh per month and gets a bill of 11.9¢ per kWh. While a small home in Houston consumes 1000 kWh per month and bills about 10.3¢ per kWh, a large home uses 2000 kWh per month and its average bill is about 10.1¢ per kWh.

Cheapest Electric Rate

How to Find the Cheapest Electric Rate Provider in Houston?

If you are confused about what is the cheapest electricity company in Texas, compare your Houston energy plans based on:

Energy Needs

1 Business

2 Residential

Most Energy Consumption Time

1 Free Nights

2 Free Weekends

Contract Type

1 Locked-in and fixed rate

2 Month-to-month and variable rate

Waivers or Discounts

Switch to the best electric company in Houston in minutes.

Use Shop Texas electricity online tool to compare power plans from many low rate electricity providers by Zip code.


Average usage and prices vary by customer and TDSP and are subject to change.