How to read your Texas Electricity Facts Label.

If you've ever compared two Texas electricity plans and thought "these should be easy to compare, but somehow they aren't," you've experienced the EFL trap. Every plan looks simple. Every plan advertises a low rate. Every plan wins on paper. The EFL is where the truth lives — and reading it correctly is the single most useful electricity skill any Texan can develop.

This guide walks through every section of a Texas EFL, what each number actually means, and the specific tricks providers use to make expensive plans look cheap. Read this once and you'll never sign up for a bill-credit trap or auto-renewal punishment plan again.

What is an EFL, and why does it exist?

The Electricity Facts Label (EFL) is a one-page standardized document that the Public Utility Commission of Texas requires every Retail Electric Provider (REP) to publish for every plan they offer. The format is fixed by law. The content is standardized. Every EFL for every plan from every REP contains the same categories in the same order.

This is deliberate. In the 2002 Texas electricity deregulation legislation, lawmakers understood that letting REPs advertise plans in whatever format they wanted would create the exact kind of confusion that harms consumers. The EFL is the legally-mandated apples-to-apples comparison document.

The catch: reading the EFL correctly requires understanding what each section is trying to hide. Providers can't lie on the EFL — but they can (and do) design plans that look great in the EFL summary and terrible in real-world use.

The 5 sections every EFL contains

Every EFL has these sections, in this order:

1. Electricity Price — the average price per kWh at 500, 1,000, and 2,000 kWh usage
2. Other Key Terms and Questions — contract length, early termination fee, whether renewable content applies
3. Fees — recurring monthly fees, one-time fees, minimum usage fees
4. Disclosure Chart — a table showing energy charge, TDU delivery charges, and how they combine
5. Fine Print Section — where bill credits, seasonal adjustments, and other complications are documented

Now let's decode each one, using a realistic Texas EFL as an example.

Section 1: The Electricity Price (and where it lies)

The top of the EFL shows three numbers — the average all-in price per kWh at 500, 1,000, and 2,000 kWh monthly usage. These are the numbers that appear in marketing. This is where the biggest tricks happen.

Wait — how is the same plan 17.4¢ at 500 kWh and 9.1¢ at 2,000 kWh? Isn't the rate the rate?

This is the first big lesson: the same plan can have three different effective rates depending on your monthly usage. There are two reasons this happens:

Reason 1: Monthly base fees

Many Texas plans include a fixed monthly fee (e.g., $9.95/month or $12.00/month) regardless of usage. If you use 500 kWh, that $10 fee is 2¢/kWh. If you use 2,000 kWh, it's 0.5¢/kWh. Same fee, very different effective rate depending on usage.

Reason 2: Bill credits

Many "cheap" Texas plans use bill credits: "Use 1,000 kWh in a month, get a $75 credit." The credit only triggers in a specific usage window. Below or above the window, no credit. So the average price at 500 kWh (below the window) is much higher than at 1,000 kWh (in the window).

Which number matters for you? The one at your actual usage tier. Pull up your last 3-6 electric bills. Add up the kWh and divide by number of months. That's your average monthly usage. Compare the EFL price at that usage level, not at whichever tier the marketing pushes.

Section 2: Other Key Terms and Questions

This section lists the plan's structural terms. Focus on these four fields:

Type of product

You'll see one of: "Fixed rate," "Variable rate," or "Indexed rate."

• Fixed rate = your energy charge is locked for the contract term. Protection from wholesale price spikes. Almost always the right choice.
• Variable rate = the rate can change month-to-month, at the provider's discretion. Avoid unless you have a very specific reason.
• Indexed rate = tied to a specific market index (e.g., natural gas prices). Rare in residential. Read the fine print carefully.

Contract term

How many months you're committed. Common terms: 12, 24, 36 months. Some month-to-month plans exist but they're rarely worth it — they typically cost 30-50% more than 12-month equivalents.

Longer terms often mean lower rates (providers reward commitment). If you're settled in your Texas home, 24-36 months is usually the sweet spot.

Early termination fee (ETF)

What you pay to break the contract before the term ends. Common range: $150-$295 for residential plans. Some plans have graduated ETFs that decrease as you approach the end of the contract.

The ETF matters if you might move mid-contract or switch to a better plan. Under Texas law, you have a 3-day right of rescission after enrollment where you can cancel without ETF. After that, you're liable.

Renewable content

Percentage of the plan's electricity that comes from renewable sources. The Texas grid average is around 25% renewable (mostly wind). Plans labeled "100% green" or "100% renewable" source exclusively from renewables.

Green plans sometimes cost slightly more, but in West Texas markets (Lubbock, San Angelo) they can actually be cheaper due to abundant local wind generation.

Section 3: Fees

This section lists any recurring or one-time fees beyond the energy rate. Read every line here.

Base charge

A fixed monthly fee regardless of usage. Some plans have no base charge. Others charge $5-15/month. This directly hits your effective rate at low usage.

Minimum usage fee

A trap that hits low-usage households. If you use below a threshold (typically 800 or 1,000 kWh), you pay an extra $5-10 fee. Apartment renters, snowbirds, and low-usage households get hit by this repeatedly.

Section 4: Disclosure Chart

This is where the plan's actual math is spelled out. Every EFL shows a breakdown of:

• Energy charge (the rate the REP charges per kWh)
• TDU delivery charges (the utility fee for delivering electricity, non-negotiable)
• Any bill credits or adjustments
• The all-in total at 500, 1,000, and 2,000 kWh

Read this section carefully because it exposes bill credit tricks. If you see a plan advertised at "8.9¢/kWh" but the disclosure chart shows an energy charge of 15¢ minus a $60 bill credit at 1,000 kWh, that's a bill credit plan. Use less than the credit trigger, and you pay 15¢.

Section 5: Fine Print

The bottom of the EFL contains footnotes and disclaimers. Read them. This is where seasonal rate adjustments, renewable energy certificate details, and other complications are documented.

Watch specifically for:

• Seasonal rate changes — some plans reset to higher rates in summer
• Wholesale energy pass-through — variable-rate plans usually disclose their pricing mechanism here
• Time-of-use restrictions — "free nights" plans document their peak-hour pricing structure here
• Provider assignment or transfer terms — what happens if the REP goes out of business (yes, this happens)

The 5 EFL red flags that mean "don't sign"

After reading a few hundred EFLs, you'll recognize the patterns. Here are the ones that should make you close the tab:

1. The advertised rate is dramatically lower than the disclosure chart average price at 1,000 kWh. Big gap = bill credit plan. If the ad says 7.9¢ and the EFL shows 12.5¢ at 1,000 kWh, you're being manipulated.

2. Minimum usage fee combined with low advertised rate. This plan is designed for the wrong household. If your usage varies or trends low, you'll pay the penalty most months.

3. Very high early termination fee ($400+). Locks you in even if the market drops. Reasonable ETFs are $150-295 for residential.

4. "Variable rate" or "indexed rate" for a 12-24 month term. You're committing to rate volatility without the protection of a fixed rate. Almost never a good deal for households.

5. Contract renewal terms buried in fine print. Look for "auto-renews to month-to-month at then-current rates." That's the trap most Texans fall into — the auto-renewed rate is typically 40-60% higher than what new customers pay.

A quick worked example

Let's compare two hypothetical Texas plans that both look appealing:

Field	Plan A	Plan B
Advertised rate	9.5¢/kWh	11.8¢/kWh
Type	Fixed with bill credit	Fixed, no credit
Contract term	12 months	24 months
ETF	$295	$150
Base charge	$9.95/mo	$0.00/mo
Bill credit	$60 at 1,000-2,000 kWh	None
Avg price at 500 kWh	16.5¢/kWh	13.4¢/kWh
Avg price at 1,000 kWh	10.8¢/kWh	13.4¢/kWh
Avg price at 2,000 kWh	10.1¢/kWh	13.4¢/kWh

Plan A wins if your usage reliably lands between 1,000 and 2,000 kWh — but loses badly if you use 500 or 800 kWh. Plan B is boring but predictable at any usage level.

For a household that uses 800 kWh in April, 1,500 kWh in July, and 600 kWh in November, Plan B is likely cheaper overall despite the higher headline rate. Plan A punishes the low-usage months.

How to actually use EFLs when shopping

Here's a simple workflow:

1. Calculate your average monthly kWh from your last 6-12 bills.
2. Note your typical range — how low and high does your monthly usage go?
3. Pull EFLs for 3-5 plans you're considering.
4. Compare "average price" at YOUR typical usage, not the advertised rate.
5. Check if any plan uses bill credits — do those credit windows fit your usage range?
6. Read the ETF and contract term — make sure you're comfortable committing.
7. Scan the fine print for auto-renewal or seasonal adjustments.

This takes about 20 minutes for 5 plans. It saves the average Texas household $200-400 per year.

Or use our plan comparison tool — it does the EFL math automatically at your ZIP code and usage level, showing live plans ranked by all-in cost.

Final thought

The Texas electricity market rewards the informed and punishes the passive. Reading the EFL is the single most important discipline you can develop. It's boring. It's not fun. And it saves you money every year for as long as you live in a deregulated Texas market.

Read the label. Every time. Before you sign anything.