The electricity industry doesn’t want you to know this: the single biggest lever for lowering your bill has nothing to do with your thermostat.
It’s your rate. The difference between an 11-cent plan and a 15-cent plan costs the average Texas household $480 per year. Yet most bill-cutting advice focuses on behavioral changes that save $10-20 per month while ignoring the rate that matters most.
Here’s the uncomfortable truth: The average Texas household uses 1,144 kWh per month and pays around $151 in electricity bills. A quarter of that—maybe more—is overpayment because they’re on the wrong plan. Let’s fix the rate problem first, then talk about the behavioral stuff.
Free Changes (Do These Today)
1. Raise Your Thermostat Just 2 Degrees
Savings: $20-30/month in summer
Set your thermostat to 78°F when you’re home in summer. Each degree above 72°F can save up to 3% on cooling costs. During Texas summers, when air conditioning accounts for 50-70% of your electric bill, those 6 degrees from 72°F to 78°F translate to roughly 18% savings on cooling.
For a household spending $150/month in summer, that’s $27 saved just by adjusting one dial.
The catch: Your home will feel warmer initially. Your body adjusts within a few days. Use ceiling fans to make it feel cooler without actually lowering the temperature.
2. Use Ceiling Fans (The Right Way)
Savings: $15-20/month in summer
Ceiling fans create a wind-chill effect that makes rooms feel 4°F cooler without changing the actual temperature. According to the Department of Energy, this allows you to raise your thermostat setting by 4°F with no reduction in comfort.
Here’s the key: Set fans to spin counterclockwise in summer (creates downward airflow). Turn them off when you leave the room—fans cool people, not air. A ceiling fan costs less than a cent per hour to run, while AC costs 30 times that.
Studies show combining ceiling fans with your AC can reduce air conditioning costs by up to 40%.
3. Fix Your Thermostat Schedule
Savings: $10-15/month
You can save as much as 10% per year on heating and cooling by turning your thermostat back 7-10°F for 8 hours per day from its normal setting. That’s roughly $150 annually for most Texas homes.
Summer schedule:
- Home: 78°F
- Away: 85°F
- Sleeping: 80-82°F
Don’t turn your AC completely off during the day. It takes more energy to cool a sweltering house from 95°F back to 78°F than to maintain 85°F.
4. Switch to the Right Electricity Plan
Savings: $20-50/month
This is the single biggest lever you have. Texas electricity rates range from 11 cents to 20+ cents per kWh. At 1,144 kWh monthly usage, that’s the difference between a $126 bill and a $229 bill—same electricity, different provider. Learning how to switch electricity providers takes 15 minutes and could save you hundreds annually.
For high-usage homes (1,500+ kWh in summer): Look for plans with low rates at high usage levels. Many plans get cheaper the more you use.
For apartments and low-usage (under 700 kWh): Avoid plans with minimum usage fees. Look for flat-rate plans without usage penalties.
For flexible schedules: Consider free nights plans if you can shift laundry, dishwashing, and charging to 9 PM - 7 AM. Providers like TXU Energy offer popular free nights options. Savings depend on shifting 40-60% of usage to off-peak hours.
Compare plans on ComparePower to see current rates for your address and usage.
5. Clean Your AC Filter Monthly
Savings: $8-15/month
A dirty air filter restricts airflow, forcing your HVAC system to work harder. The US Department of Energy estimates clean air filters can cut your HVAC system’s energy consumption by up to 15%.
For a home spending $150/month on electricity in summer (when AC is 60% of the bill), that’s $90 going to cooling. A 15% reduction saves $13.50 monthly.
Filters cost $3-5. Change them every 30 days during heavy AC months (May-September in Texas), every 90 days in milder months.
6. Unplug Energy Vampires
Savings: $10-15/month
Standby power—when devices are “off” but still plugged in—accounts for 5-10% of residential energy use. That costs the average household up to $183 per year, or about $15/month.
The worst offenders:
- Cable boxes and DVRs
- Game consoles
- Desktop computers and monitors
- Coffee makers with digital displays
- Phone chargers (when not charging)
- Printers
Use power strips for entertainment centers and home office setups. One switch kills phantom drain from multiple devices. Or just unplug devices you don’t use daily.
Low-Cost Upgrades ($20-100)
7. Install a Smart Thermostat
Cost: $85-130 after rebates | Savings: $150-250/year
Smart thermostats like Nest and Ecobee learn your schedule and automatically adjust temperatures for maximum efficiency.
Documented savings:
- Ecobee users save up to 26% on heating and cooling costs (average $284/year)
- Nest users save 10-12% on heating, 15% on cooling
- ENERGY STAR estimates average savings of $50/year, though Texas homes see higher savings due to heavy AC use
Texas utility rebates for 2026:
- CenterPoint (Houston): Up to $75 instant rebate
- Oncor (Dallas-Fort Worth): Up to $65 rebate
- Austin Energy: $50 rebate + $75 enrollment credit + $25 annual credit
- CPS Energy (San Antonio): $85 one-time rebate + $30 annual credit
After rebates, you’re looking at $85-130 out of pocket for a device that saves $150-250 annually. Payback period: 6-12 months.
8. Switch to LED Bulbs
Cost: $50-75 for whole house | Savings: $60-75/year
LEDs use 75-85% less energy than incandescent bulbs and last 25 times longer. A 60W incandescent costs about $7/year to run (at Texas’s average 15¢/kWh). A 9W LED providing the same light costs $1/year.
For a home with 40 bulbs, switching from incandescent to LED saves $240/year. Even compared to CFLs, LEDs save money and don’t contain mercury.
Do the math: If you’re still using incandescent bulbs in high-use areas (kitchen, living room, bathrooms), swap them first. Payback is immediate.
9. Add Weatherstripping and Caulk
Cost: $20-40 | Savings: $10-15/month
Air leaks around doors and windows make your AC work harder. Weatherstripping and caulk seal gaps and cost about $30-40 for materials.
Focus on:
- Door sweeps (especially garage access doors)
- Window frames where you feel drafts
- Gaps around exterior pipes and vents
- Attic access panels
This is a Saturday afternoon project that pays for itself in 2-3 months.
Bigger Investments ($200-500)
10. Lower Your Water Heater Temperature
Savings: $36-61/year
Most water heaters ship set to 140°F. The Department of Energy recommends 120°F for most households, which can cut water heating costs by 6-10%.
Water heating accounts for 18% of home energy use in Texas. For a home spending $150/month on electricity, that’s $27/month or $324/year. A 10% reduction saves $32/year with zero cost—just turn a dial.
How to adjust: Look for a temperature dial on your water heater (gas or electric). Turn it to 120°F or the “warm” setting. Wait 24 hours and test your hot water temperature.
Safety note: 120°F is safe for most households. If someone in your home has a suppressed immune system or chronic respiratory disease, consult a doctor first, as there’s a slight increased risk of Legionella bacteria below 140°F.
11. Optimize Your Refrigerator
Savings: $5-10/month
Your refrigerator runs 24/7 and accounts for about 7% of household electricity use. Small optimizations add up:
Set proper temperatures:
- Refrigerator: 37°F (optimal balance of food safety and efficiency)
- Freezer: 5°F
If your fridge is 10°F colder than necessary, it can use 25% more energy—an extra $5-8/month.
Other tips:
- Clean the coils twice a year (dirty coils increase energy use by up to 35%)
- Check door seals for cracks or gaps
- Keep it at least 2/3 full (less air to cool)
- Leave 3-4 inches between the wall and back for airflow
- Don’t place it near your oven or in direct sunlight
12. Use Time-of-Use Plans Strategically
Savings: $30-60/month (if you can shift usage)
Time-of-use plans like free nights (9 PM - 7 AM) or free weekends can dramatically cut bills—if you can shift high-energy activities to off-peak times.
High-energy activities to shift:
- Running the dishwasher (1-2 kWh per load)
- Clothes dryer (2-5 kWh per load)
- Charging electric vehicles (varies)
- Running pool pumps (can be automated)
- Laundry washing (0.5-2 kWh per load)
If you already use 40-60% of your electricity during off-peak hours, or can get there with small adjustments, you may see tangible savings compared to a fixed-rate plan. However, these plans typically charge 18-20¢/kWh during peak hours (versus 12-14¢ on standard plans), so using peak power can quickly erase savings.
Who benefits: Night shift workers, people working from home with flexible schedules, EV owners who charge overnight, families who can run appliances in the evening.
Who should avoid: Anyone home during the day running AC heavily, families with rigid schedules that require daytime laundry and cooking.
Compare time-of-use plans to see if the math works for your schedule.
What About Solar?
Rooftop solar is a bigger topic that deserves its own discussion, but here’s the quick math for Texas in 2026:
Average system cost: $15,000-25,000 before incentives Federal tax credit: 30% (so $10,500-17,500 after credit) Payback period: 8-12 years at current electricity rates Annual savings: $1,200-2,000 once installed
Solar makes sense if you’re planning to stay in your home for 10+ years, have good southern exposure, and want to lock in electricity costs. It’s not a quick win for immediate bill reduction.
Providers like Rhythm Energy and Green Mountain Energy offer solar buyback plans if you already have panels or are installing them.
The Reality Check
You don’t need to do all 12 of these. Pick the low-hanging fruit:
Zero cost, do today: Raise thermostat 2 degrees, change your schedule, use ceiling fans, clean AC filter. Expected monthly savings: $40-60
One-time purchases under $150: Smart thermostat (with rebates), LED bulbs, weatherstripping. Expected monthly savings: $25-35 Payback period: 3-6 months
The big one: Switch to a cheaper electricity plan. Understanding fixed vs variable rate plans helps you pick the right type. Expected monthly savings: $20-50 Time required: 20 minutes
A typical Texas household implementing the free changes plus a plan switch can realistically cut their electricity bill by $60-100/month. Over a year, that’s $720-1,200 back in your pocket.
The Bottom Line
Texas gives you two advantages: a deregulated market where you can shop for cheaper rates, and enough competition that providers actually have to compete on price. Use both.
Start with the free stuff (thermostat, fans, filters), switch to a better electricity plan, then add smart home tech when it makes sense.
Or keep doing what you’re doing and keep paying $150+/month. Your call.
Ready to compare plans? See current electricity rates for your address on ComparePower.
Looking for specific provider types? Check out our guides: