Why Delivery Charges Exist and Who Sets Them
Texas deregulated its retail electricity market in 2002, but it did not deregulate the physical infrastructure. The poles, wires, transformers, and meters that move electricity from generating plants to your home belong to Transmission and Distribution Utilities (TDUs). In the Houston metro area, that TDU is CenterPoint Energy.
CenterPoint does not sell you electricity. It delivers it. The Public Utility Commission of Texas (PUCT) regulates what CenterPoint can charge for that delivery through a rate-setting process called a tariff docket. The current residential tariff was most recently updated following CenterPoint’s 2021 rate case (Docket No. 51414). PUCT only publishes tariff snapshots at irregular intervals tied to rate cases, so the figures cited here reflect the tariff schedule in effect as of the most recent publicly available filing. Readers should verify current rates at puc.texas.gov before making budget calculations.
Every licensed retail electricity provider (REP) selling power in CenterPoint’s service territory passes these charges through to customers. Some REPs roll them into a single blended per-kWh rate. Others list them as a separate line item labeled “TDU Delivery Charges” or “CenterPoint Pass-Through.” The dollar amount is the same either way. The difference is presentation, not cost.
The Two-Part Structure: Customer Charge Plus Energy Charge
CenterPoint’s residential delivery tariff has two components.
1. The monthly customer charge (fixed)
This is a flat fee assessed every billing cycle regardless of how much electricity you use. As of the current tariff, this charge is approximately $5.18 per month for standard residential service. It covers metering, billing infrastructure, and the fixed cost of maintaining your service connection. You pay this whether you use 100 kWh or 2,000 kWh.
2. The energy delivery charge (variable)
This is charged per kilowatt-hour consumed. It has two sub-tiers under the current tariff.
- Transmission charge: approximately $0.03654 per kWh
- Distribution charge: approximately $0.04072 per kWh
Combined, the variable delivery cost is roughly $0.07726 per kWh before any additional riders are applied.
How the math works at common usage levels:
At 1,000 kWh (close to the Texas residential average for a mild month):
- Customer charge: $5.18
- Variable delivery: 1,000 x $0.07726 = $77.26
- Total delivery cost: approximately $82.44
At 1,500 kWh (a typical Houston summer month):
- Customer charge: $5.18
- Variable delivery: 1,500 x $0.07726 = $115.89
- Total delivery cost: approximately $121.07
If your REP is quoting you an “energy charge” of $0.09 per kWh, your actual all-in variable cost per kWh is closer to $0.167 once delivery is added. That gap matters when comparing plan offers.
Riders: The Line Items Most Customers Miss
Beyond the base tariff, CenterPoint applies a series of riders. These are PUCT-approved cost-recovery mechanisms for specific infrastructure programs or mandated expenses. Riders change more frequently than the base tariff and are the primary reason your delivery charge can shift month over month without any change to your retail plan.
The riders currently active in CenterPoint’s residential tariff include:
Advanced Metering System (AMS) Rider. Recovers the cost of smart meter deployment. This rider has been in place since the initial smart meter rollout and continues to carry residual balance costs. Current rate: approximately $0.00218 per kWh.
Distribution Cost Recovery Factor (DCRF). Allows CenterPoint to recover distribution investment between full rate cases. This is a mechanism the PUCT created specifically so utilities can keep pace with infrastructure investment without filing a full docket every year. The DCRF rate adjusts annually. The most recently approved DCRF added approximately $0.00278 per kWh to residential bills.
Transmission Cost of Service (TCOS) Rider. Recovers ERCOT-mandated transmission costs that fall outside CenterPoint’s direct control. Updated semi-annually. Current rate: approximately $0.00412 per kWh.
Energy Efficiency Cost Recovery Factor (EECRF). Funds state-mandated energy efficiency programs. Rate varies by year. Recent filings have placed this at approximately $0.00097 per kWh.
Storm Securitization Rider. Following Winter Storm Uri in February 2021, the Texas legislature authorized TDUs to securitize storm-recovery costs through Senate Bill 1580. CenterPoint issued storm bonds and recovers the debt service through this rider. As of the most recent public filing, this rider adds approximately $0.00183 per kWh and is expected to remain in place for roughly 12 to 15 years depending on bond amortization.
Adding all active riders to the base variable rate produces an effective delivery rate in the range of $0.088 to $0.092 per kWh, depending on the specific billing month and any in-cycle rider adjustments. At 1,000 kWh, that means total delivery charges in the $88 to $92 range before the fixed customer charge.
This is why a provider advertising a 9.5 cents per kWh energy rate at 1,000 kWh may produce a total bill above 18 cents per kWh all-in. The Electricity Facts Label (EFL) required by PUCT is supposed to show the average price at 500, 1,000, and 2,000 kWh inclusive of delivery. If a provider’s EFL omits delivery charges or buries them, that is a disclosure problem worth flagging to PUCT (filing address: customer@puc.texas.gov).
What You Can and Cannot Control
Delivery charges are non-negotiable in the sense that you cannot switch TDUs. If you live in CenterPoint’s territory, you pay CenterPoint’s tariff. No retail provider can reduce that cost. Any provider claiming otherwise is misrepresenting the market structure.
What you can control:
Usage. The variable portion of delivery scales directly with consumption. Reducing usage from 1,500 kWh to 1,200 kWh saves approximately $23.18 in delivery charges alone at current rates, independent of any change to your energy rate.
Plan structure. Some REPs offer plans with a bill credit at specific usage thresholds (for example, a $50 credit if you use more than 1,000 kWh). This does not reduce delivery charges but affects the net bill. Reading the EFL carefully against your typical usage pattern determines whether those credits actually benefit your household.
Time-of-use alignment. CenterPoint’s smart meters support interval data. Some REP plans price on-peak and off-peak energy differently. Shifting load away from peak hours reduces energy cost per kWh, which affects your total bill even though delivery charges themselves are not time-differentiated at the residential level.
How to Report a Power Outage to CenterPoint
Outage reporting goes to CenterPoint directly, not to your retail provider. Your REP cannot restore power. CenterPoint operates the physical grid.
CenterPoint Energy phone number for outages: 713-207-2222. This line is staffed 24 hours a day, seven days a week. For hearing-impaired customers, the TTY number is 713-207-2222 (the same line supports relay calls).
Online outage reporting: CenterPoint’s outage map and self-reporting tool are available at centerpointenergy.com/en-us/residential/home/electric/report-power-outage. The system allows you to report an outage and check restoration estimates without speaking to a representative.
CenterPoint mobile app: The app (available on iOS and Android) supports outage reporting, restoration status tracking, and usage monitoring through your smart meter data. Meter data typically updates at 15-minute intervals for customers enrolled in the advanced metering program.
For general billing or tariff inquiries to CenterPoint, the customer service phone number is 800-752-8036. Note that CenterPoint does not handle retail billing disputes. If your complaint is about a charge on your REP’s invoice, that escalation path runs through your REP first, then PUCT if unresolved.
Delivery Charges Across TDUs: Where CenterPoint Ranks
Texas has five major investor-owned TDUs: CenterPoint (Houston area), Oncor (Dallas-Fort Worth), AEP Texas (South and West Texas), Texas-New Mexico Power (TNMP, suburban and rural markets), and Entergy Texas (Southeast Texas).
Based on the most recently published tariff schedules, effective variable delivery rates at 1,000 kWh rank roughly as follows (inclusive of riders, excluding fixed customer charge):
- TNMP: approximately $0.104 per kWh (highest among the five)
- AEP Texas Central: approximately $0.097 per kWh
- CenterPoint: approximately $0.088 to $0.092 per kWh
- Entergy Texas: approximately $0.086 per kWh
- Oncor: approximately $0.082 per kWh (lowest among the five)
CenterPoint sits in the middle of the range. Oncor’s lower rate is partly a function of its larger service territory and the economies of scale that come with serving the Dallas-Fort Worth metroplex. TNMP’s higher rate reflects the cost of serving a more dispersed, lower-density customer base.
The practical implication: a customer comparing a CenterPoint-territory offer to an Oncor-territory offer at the same nominal energy rate will face a higher total bill in Houston. This is relevant when evaluating whether relocating within Texas changes your electricity economics.
Reading Your Bill Correctly
When your monthly statement arrives, identify these items specifically:
- Energy charge (from your REP): the per-kWh rate times your usage, plus any applicable REP fees or credits.
- TDU delivery charge (passed through by your REP, originating from CenterPoint’s tariff): should be broken into customer charge and variable charge. Some REPs consolidate these.
- Taxes and fees: PUCT assessment (currently $0.000065 per kWh), state sales tax, and any applicable municipal franchise fees. These are small but real.
If your REP’s invoice does not clearly identify the TDU delivery component, request an itemized breakdown. PUCT’s Customer Protection Rules (16 TAC Section 25.474) require REPs to provide billing statements that allow customers to identify TDU charges separately from retail energy charges. A refusal to provide that breakdown is a reportable compliance issue.
The Bottom Line on CenterPoint Delivery Charges
CenterPoint Energy delivery charges are a fixed feature of the Houston electricity market. They are set by PUCT tariff, not by your retail provider, and they adjust periodically through rider mechanisms that most customers never see explained on their bill. At typical Houston usage levels, delivery represents 35 to 45 percent of total electricity cost. Any plan comparison that does not account for delivery charges is an incomplete comparison. The EFL for any plan you are evaluating should show all-in pricing at 1,000 kWh. If it does not, that omission is itself informative.