Houston is the largest deregulated electricity market in Texas. With more than 7 million people in the metro and over 100 retail electricity providers competing for service, Houstonians have more plan choices than almost any other US market — but the abundance also means picking wrong is expensive.
Every Houston-area residential customer pays CenterPoint Energy for delivery — that part of your bill is identical no matter which retail electricity provider (REP) you pick. CenterPoint's current TDU charges run about 4.78¢/kWh plus a monthly service fee of $4.39. Together that's roughly $60 of a typical 1,000 kWh bill before you pay a penny for the actual electricity.
The actual electricity rate — the part you can control — is set by your Retail Electric Provider (REP). In Houston, the most common providers are Reliant, TXU Energy, Direct Energy, Gexa, Constellation. Switching providers takes 1-2 billing cycles and doesn't interrupt service.
Many Houston plans advertise "$100 off when you use 1,000 kWh" — but pad the energy rate to compensate. If you usually use 800 kWh or 1,200 kWh, you miss the credit and pay 30% more than a simple fixed-rate plan.
Houston summers push the entire ERCOT grid. If you're on a variable-rate plan, expect 40-60% rate spikes in August. Fixed-rate plans protect you here.
Reliant, TXU, and other major Houston REPs renew expiring fixed plans onto month-to-month rates that average 50-80% higher than market. Check your contract end date.
The fastest way: use our plan comparison tool with your ZIP code. It pulls every available plan from the Compare Power database (the same data REPs publish to the Public Utility Commission of Texas) and ranks them by what you would actually pay at your usage level.
If you don't know your usage, run the bill calculator first to estimate it, or check your last bill for the "kWh used" number.
Houston's deregulated market has 40+ Retail Electric Providers (REPs), but a handful dominate the CenterPoint territory. Here's how they typically compare for a Houston household using ~1,200 kWh/month:
Reliant Energy — The largest brand in Houston. Convenient, strong customer service, but rates run 2-4¢/kWh above the cheapest available. You pay for the brand recognition.
TXU Energy — Similar to Reliant. Widely marketed, decent service, higher-than-market rates. Watch for auto-renewal into month-to-month plans at 40-60% higher.
Gexa Energy — Consistently competitive on rate. Good middle-ground option. Watch their bill credit plans in summer if usage varies.
Direct Energy — Wide plan selection including 100% green options. Reasonable rates, occasional promotional pricing worth catching.
Constellation — Often has the cheapest fixed-rate plans in Houston, but marketing budget is smaller so most Houstonians never hear about them. Worth checking.
Champion Energy, Cirro, Amigo Energy, Payless Power — Smaller Houston-active REPs. Sometimes have the cheapest available plans; sometimes have hidden fees. Read the Electricity Facts Label (EFL) carefully.
Houston combines high humidity with extreme heat, which makes air conditioning work significantly harder per degree of cooling. The result: Houston households typically see bills spike from ~$130 in May to ~$260-290 in August — a nearly 100% increase driven almost entirely by AC load.
The specific mechanics: A 3-ton AC in Houston runs 14-16 hours daily in July-August (versus 4-6 hours in April). Humidity forces the unit to spend extra energy on moisture removal before cooling begins. Combined with occasional ERCOT wholesale price spikes during heat waves, this is why we recommend Houston households lock in fixed-rate plans by early April every year.
For more on this: Why Texas bills spike in summer — full breakdown of the mechanics.
1. Signing up at closing with the builder's preferred REP. New Houston homeowners often get a "welcome" pitch from a specific provider at closing. These are rarely competitive rates — they're referral partnerships. Always compare against the broader market before committing.
2. Falling for the "9.5¢" bill credit teaser. Many Houston-targeted ads promote rates in the 8-9¢ range. These are almost always bill credit plans that require exactly 1,000-2,000 kWh per month to trigger the credit. Houston households at 800 or 2,300 kWh miss the credit and pay 15-18¢ effectively.
3. Auto-renewing an expiring fixed plan. Reliant, TXU, and other major REPs will renew your expiring fixed-rate plan onto a month-to-month rate that averages 50-80% higher. Mark your contract end date on your calendar 45 days ahead and re-shop.
All of Houston-metro is served by CenterPoint Energy for delivery, so TDU charges are consistent across the metro. What varies:
Use our Houston plan comparison tool with your exact ZIP for live rates in your specific area.
Switching electricity providers in Houston is straightforward and takes about 15 minutes if you have the information ready. Here's the step-by-step process for Houston residents.
Before you start comparing plans, have these three things ready:
Houston households average 1,400+ kWh/month during summer, so bill credit plans (1,000 kWh minimum) often work — but only if your usage is predictable. Use our plan comparison tool to see every available plan in your ZIP ranked by all-in cost at your usage level. This filters out plans that only look cheap on paper.
Every Texas electricity plan comes with an Electricity Facts Label (EFL) — a one-page contract summary required by the Public Utility Commission. Before signing up, check three things on the EFL: (1) the all-in rate at your specific usage tier, (2) any bill credits and the exact kWh window they require, and (3) the contract length and early termination fee. If any of those look off, skip the plan.
Once you pick a plan, sign-up takes about 5 minutes. The new provider handles the switch — you don't have to call your old provider or arrange anything with CenterPoint. Your service continues uninterrupted; only your billing switches at your next meter read (typically 15-30 days out).
Most Houston households save $250-500/yr by switching from an auto-renewed month-to-month plan to a 12-month fixed plan under 12¢/kWh.
Houston-specific gotcha: Watch out: some Houston ZIP codes (like 77001) are PO Box zones that don't return residential plans in comparison tools. Always use your physical home ZIP.
If you're currently locked in a fixed-rate contract, you may owe an early termination fee (typically $150-295) if you switch before the contract ends. Do the math: if your new rate saves you more than the ETF over the remaining contract term, switching still makes sense. If you have less than 3 months left, wait it out. Set a calendar reminder for 30 days before your contract end date so you can switch without penalty.
Can I switch electricity providers in Houston? If you're in a deregulated part of Houston, yes — most of Houston can switch any time. There's no service interruption.
Does switching providers cost anything? No. Switching itself is free. If you're mid-contract on your current plan, you might owe an Early Termination Fee (typically $150-$295) to your current REP — check your contract.
How long does switching take? Usually 1-2 billing cycles (3-8 weeks). The same poles deliver your electricity throughout; only the billing entity changes.
Will my power get shut off if I switch? No. Switching is paperwork-only. CenterPoint Energy continues to deliver power without interruption.
Four free tools, no signup, real Texas data.
One quick conversation. We'll review what you're paying, find you a better rate, and handle the switch if it makes sense. No obligation, no pressure.