But in Houston, where there are 52 companies on Power to Choose each offering several different power plans, there might be too many choices. Economists have found that when confronted with a large number of choices, most people tend to do nothing. In one well-known behavioral economics experiment, researchers set out six samples of fruit jams at a grocery store, enticing 30 percent of shoppers to buy the product. But when they increased the number of samples to 24, only 3 percent of shoppers made a purchase.
On the one hand, long-term, fixed-rate (contract) plans offer stability in pricing. If energy supply costs suddenly go up in your area, you won’t be left paying more than what you bargained for.  You’ll have peace-of-mind.  If you want to switch out of your contract before it ends with a lower cost plan, you’ll likely face a cancellation fee (early termination fee).
Texas consumers can save hundreds of dollars each year by shopping for electricity, but most don’t seek out better deals, overwhelmed by the number and complexity of power plans on the state’s Power to Choose website, wary of fine print in too-good-to-be true offers, or just too busy to spend time calculating whether free nights and weekends offset the higher rates they pay during the week.
As a result, power companies have shut down Texas coal plants unable to compete with lower-cost generators. Meanwhile, the low electricity prices of recent years — a function of cheap natural gas — and small profits have discouraged companies from investing in new power plants. ERCOT, which oversees about 90 percent of the state’s power grid, said power reserves that are called on when demand peaks on the hottest summer days have shrunk to the lowest levels since Texas deregulated power markets in 2002.
Some good news: According to J.D. Power’s 2016 survey on retail electric providers (its most current survey of the space), Texas has the highest overall satisfaction with retail electric providers out of any state. And because rates, plans, and offers can be so similar from provider to provider, customer satisfaction scores are a great way to break a tie. Think of it like choosing who to hire when you have two candidates with similar resumes — you’re going to pick the person with the glowing references.
Since 2002, the majority of Texans have had to choose their own Retail Electric Provider (REP) – the middleman that buys electricity wholesale, then sells it to you, the consumer. According to the Public Utility Commission of Texas’ 2017 report, the Lone Star state is “the national leader in competitive residential, commercial, and industrial offerings,” which means there are well over 200 providers bidding for your attention.
Where should you shop for electricity? Houstonians have the power to choose from an overwhelming variety of energy suppliers, plans, and options. If you live in the Houston metro area and your local electric utility is CenterPoint, over 50 different retail electricity providers currently offer electricity plans in your area. Each of these electricity providers offer sites, tools, and information on how to switch plans and providers. However, their information is often filled with electricity rates that are difficult to compare because of things like introductory rates, bill credits, narrow usage levels, unexpected fees, and legalese buried in the EFLs. Fortunately, Houston homes and businesses have electricity shopping options that make the process much simpler.
CenterPoint Intelligent Energy Solutions LLC, IES, which manages TrueCost, is not the same legal entity as CenterPoint Energy Resources Corp. (CERC) or CenterPoint Energy Houston Electric, LLC (CEHE), nor is IES regulated by the Railroad Commission of Texas or the Public Utility Commission of Texas. You do not have to buy products or services from IES in order to continue to receive quality regulated services from CERC or CEHE.
These rates are a better option for customers who own a home or have a long-term lease. These electric plans offer price protection and stability but usually require a longer commitment. The energy rates and prices will remain constant rather than fluctuating each month. The downside of this is that when energy prices drop, you will not benefit from the discounted energy. The positive, however, is that when energy prices spike, you will not be affected.
Prepaid electricity plans are yet another option available to Texas customers. Prepaid plans let you avoid credit checks and deposits by pre-paying for your electricity. Prepaid electricity plans typically do not have a fixed duration and operate on a pay-as-you-go basis. Shopping for prepaid electricity can often yield relatively cheap electricity with no deposit. See Prepaid Electricity: Is It Right For Me? for more.

The Electricity Facts Label (EFL) is the industry standard document that contains all the fine print about an electricity plan.  In it you will find all of the components that make up the electricity rate that is advertised for that plan.   You will find the rate you should expect to pay at 3 standard levels of monthly usage in Houston:  500kWh, 1000 kWh, and 2000 kWh hours.
Since the electricity market opened, more and more electricity providers have entered the market with various plans and products. Direct Energy and their affiliated brands: Bounce Energy , First Choice Power, and CPL Retail Energy offer a multitude of electricity plans and benefits so customers can find the electricity plan that best fits their needs. While it’s great to have so many options, it can be difficult and confusing to choose an electricity plan. With choices like fixed-rate, variable-rate, and prepaid plans, as well as varying price options, term lengths and rewards, shopping for an electricity plan can be an overwhelming task.
Electric companies buy longer-term contracts so they can hedge their risks when they’re selling long-term electricity plans. Just a week ago, it looked as if wholesale prices would be as high as Texas has seen in the past 15 years, said Ned Ross, director of governmental affairs for Direct Energy, the third biggest seller of electricity in Texas, behind No. 1 NRG and No. 2 TXU. Future prices have retreated recently, but companies buying power for August are still paying at least double what they paid a year ago, according to data from the Electric Reliability Council of Texas, or ERCOT, which oversees the state’s power markets.
Brothers Augustus Chapmen Allen and John Kirby Allen founded the city of Houston, Texas on August 30, 1836. The city was founded on some land near the banks of Buffalo Bayou. Its name comes from the general, Sam Houston who eventually became the first president of the Republic of Texas. Not only is Houston the most populous city in Texas, but its broad industrial base in energy, manufacturing, and transportation make it clear that there’s a high demand for efficient and reliable energy here.
The Electric Reliability Council of Texas (ERCOT) does it for you. When you sign up for a plan with a new provider, ERCOT will send you a mailer confirming the switch. You have three days upon receiving the mailer to change your mind. If you don't, you'll have a new provider within seven days, and ERCOT will notify your old provider. Just remember, if you abandon a contract before it's complete, you will be on the hook for any fees or penalties detailed in its Terms of Service.
These rates are a better option for customers who own a home or have a long-term lease. These electric plans offer price protection and stability but usually require a longer commitment. The energy rates and prices will remain constant rather than fluctuating each month. The downside of this is that when energy prices drop, you will not benefit from the discounted energy. The positive, however, is that when energy prices spike, you will not be affected.

You can sort, filter, and shop by pricing at YOUR specific usage level, which lets you shop and compare electricity plans based on the rates you’ll actually experience on your bill, inclusive of hidden fees and taxes. This ensures you’re not misled by the cheaper rates often advertised by electric providers…those “teaser rates” associated with higher usage levels that many households never enjoy because their usage level never reaches that pricing tier.
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