Your electricity company is betting you won’t read this article.
They’re counting on inertia, confusion, and the assumption that switching is complicated. It’s not. Switching electric companies in Texas takes 15 minutes, costs nothing, and requires zero technician visits. Your power never goes out. The whole process happens behind the scenes while you go about your day.
So why do so many Texans stay with overpriced companies? Because the industry has spent 20 years making it seem harder than it is. They’ve buried information in fine print. They’ve made comparing plans deliberately confusing. And they count on you never noticing the day your contract ends, when you slide onto a month-to-month price nobody quoted you.
Here’s the truth about switching, what they don’t want you to know, and the specific mistakes that cost Texans hundreds of dollars every year.
The Dirty Secret About Switching
Here’s what the electricity industry doesn’t advertise: switching is trivially easy because you’re not changing anything physical.
Texas deregulated electricity in 2002. That means the company that delivers power (your utility like Oncor or CenterPoint) is completely separate from the company that sells it to you (your electric company, like TXU or Reliant).
When you switch companies, the poles and wires don’t change. Your utility still maintains the grid, reads your meter, and handles outages. The only thing that changes is which company sends your bill and at what rate. For more on how utilities work, see our guide on understanding TDU charges.
This is why switching causes zero service interruption. The infrastructure is identical. The electrons are identical. You’re just changing who gets paid and how much.
What You Need Before You Start
Gather these before you begin:
From your current electricity bill:
- Your ESI ID (Electric Service Identifier) — a unique 17 or 22-digit number identifying your address
- Your current company’s name
- Your account number
- Your average monthly usage (in kWh)
Your ESI ID is not your meter number. The ESI ID identifies your service location. Your meter number identifies the physical meter device. Most bills list your ESI ID near your account number. Can’t find it? Use an ESI ID lookup tool with your address.
Personal information:
- Full legal name
- Service address
- Contact phone number and email
- Social Security Number (for credit check, if required)
That’s it. No account numbers from your new company. No special forms. Just the basics.
The 5-Step Switching Process
Step 1: Check Your Contract End Date
Before anything else, find out when your current contract ends. This single date determines whether switching will cost you money.
Where to look:
- Your most recent bill (companies must send at least three written expiration notices during the last third of your contract, the final one at least 30 days before it ends)
- Your company’s online account portal
- Your original contract documents
- Call customer service
Why it matters: Leave a fixed-rate contract early and you’ll owe an Early Termination Fee (ETF). Most are flat: $150 on most 12-month plans, about $295 on 24-month, and up to $395 on 36-month plans at the largest companies (TXU, Reliant, Gexa, Direct). Some companies, such as Rhythm, charge $20 per month remaining instead. On a 24-month contract with 16 months left at $20 a month, that’s $320 out of pocket.
The 14-day window: Texas law requires your company to let you switch penalty-free during the last 14 days of your contract. This is your target.
If you’re moving: Good news. Texas law waives all ETFs when you’re switching addresses, as long as you give a forwarding address and, if asked, proof of the move. You’re free to leave anytime with no penalty.
Step 2: Compare Available Plans
Don’t just grab the lowest advertised rate. That number rarely tells the full story.
Use comparison tools:
- Compare plans on ComparePower
- Look at the Electricity Facts Label (EFL) for every plan
- Calculate your actual cost based on your usage
What to watch for:
- Base charges and fees that aren’t in the advertised rate
- Usage thresholds — some plans spike if you use too much or too little
- Contract length, and what the price spread between 12, 24, and 36 months looks like today
- Early termination fees on the new plan
Match plans to your usage: A plan optimized for 2,000 kWh per month will cost more if you use 1,000 kWh. Check your past bills and find your average monthly usage. Pick a plan that gives you the best rate at that level.
For help deciding, check our company comparisons to see how they stack up on service quality, not just price.
Step 3: Review the Terms Before You Sign
You’re about to sign a contract. Read it.
Check these specifics:
- Total average cost per kWh at your usage level (not the teaser rate)
- Monthly base charges or customer fees
- Early termination fee amount and structure
- Contract length
- What happens when your contract ends (the default month-to-month product and its price)
- Whether there are bill credits and what triggers them
Red flags:
- Plans with rates that vary dramatically based on usage levels
- A default month-to-month price far above the rate you’re signing for
- Fees buried in fine print
If anything is unclear, call the company before signing. Once you’re in, changing your mind can cost money.
Step 4: Sign Up With Your New Company
Once you’ve found the right plan, enrollment takes about 10 minutes.
The signup process:
- Go to the company’s website or call them directly
- Enter your service address and ESI ID
- Select your plan and contract length
- Choose your start date
- Provide personal information (name, contact details, SSN for credit check)
- Review terms and sign electronically
Choose your switch date carefully:
- If you’re in your 14-day ETF-free window, schedule within that period
- If you’re moving, set the date for your move-in day
- For standard switches, the earliest available date is usually fine; with a smart meter there’s no meter-read cycle to wait for
Credit checks and deposits: Most companies run a credit check. If your credit is below the threshold, you’ll pay a deposit (often $100-400; state rules cap it at the greater of one-fifth of your estimated annual bill or your estimated next two months’ bills). Some companies like Gexa Energy will waive the deposit if your credit check is satisfactory, if you bring a credit-reference letter from your previous electric company showing no more than one late payment in the past 12 months, or if you’re 65 or older and current on your bills.
You don’t need to contact your old company. Your new company handles everything, including notifying the old one. In fact, calling to cancel early can trigger unnecessary fees.
Step 5: Wait for the Switch (Nothing Happens)
Seriously. You’ll notice nothing.
Timeline:
- Standard switches: usually 1 to 3 business days with a smart meter; the required notice says a switch may take up to seven business days
- Same-day service: some companies offer it if you sign up before their cutoff time (cutoffs vary, from about noon to 6 p.m. CT on weekdays)
- Scheduled switches: your chosen date
What happens:
- Your new company notifies your utility (Oncor, CenterPoint, etc.)
- The utility updates its records
- At midnight on your switch date, billing transfers to the new company
- Your power stays on the entire time
Your utility doesn’t change. If you have Oncor now, you’ll still have Oncor after. They maintain the infrastructure regardless of who you buy power from.
Your first bill: Expect a final bill from your old company (prorated to your switch date) and your first bill from the new one within 2-4 weeks.
Timeline: How Long Does Switching Take?
From decision to switch:
- 15 minutes: Time to compare plans and sign up online
- 1 to 3 business days: typical time until the switch completes with a smart meter; the required notice says up to seven
- 0 seconds: Time your power is out
Exceptions:
- Moving to a new address: Takes longer only if the home has no meter yet (new construction), and that part is up to the utility
- Same-day service: available from many companies if you enroll before their weekday cutoff (about noon to 6 p.m. CT, depending on the company)
- Scheduled future switches: You can lock in a rate 30-90 days in advance
The process is faster than most people expect. With smart meters, the utility reads your meter remotely on the switch date, so there’s no meter-read cycle to wait for.
Common Mistakes That Cost Money
1. Canceling Your Old Company First
Don’t call your current company to cancel. Let the new one handle it. If you cancel first, you could:
- Create a gap in service
- Trigger early termination fees unnecessarily
Your new company notifies the old one automatically. That’s how the system works.
2. Ignoring Early Termination Fees
One of the most common complaints in company reviews: “I didn’t know I’d be charged $150 to switch.”
Before you switch mid-contract, calculate:
- Remaining months × your per-month ETF rate, if your plan uses one
- Or the flat fee: $150 on most 12-month plans, about $295 on 24-month, up to $395 on 36-month
- Compare that cost to potential savings
Sometimes paying the ETF makes sense. Often it doesn’t. Do the math before you commit.
3. Choosing Plans Based Only on Advertised Rates
That “7.9 cents per kWh” plan? It’s probably 7.9 cents only at exactly 2,000 kWh usage. Use 1,500 kWh and you might pay 12 cents. Use 2,500 kWh and you might pay 11 cents.
Always look at:
- Your actual usage level (check past bills)
- The EFL’s rate chart at different usage levels
- Monthly base charges
- One-time signup fees
The cheapest advertised rate is rarely the cheapest actual bill.
4. Not Reading the Electricity Facts Label
The EFL is a standardized document showing exactly what you’ll pay. It includes:
- Rates at 500, 1000, and 2000 kWh usage levels
- All fees and charges
- Contract terms
- Renewable energy percentage
Spend 3 minutes reading it. It’ll save you from surprises later. For the full breakdown, check out our Electricity Facts Label guide.
5. Waiting for the “Right” Month
The standard advice says rates spike every summer, so hold off. The numbers don’t support it. Retail 12-month fixed prices move only a few percent by season, and the direction flips year to year: summer 2024 ran about 9% above October, summer 2025 showed no premium at all (April was that year’s high), and summer 2026 was the cheapest stretch of the year.
What does climb every summer is your bill, because your AC runs more. That’s usage, not price.
What to do instead:
- Check today’s spread yourself instead of waiting for a month on a calendar
- Shop 30 days before your contract ends, whatever month that lands in
- Compare at your own usage level, since your summer kWh total is higher than your spring one
6. Forgetting About Outstanding Balances
Owe money to your current electric company? If you set up a deferred payment plan for a past-due balance, they can place a “switch hold” on your account, blocking you from switching until you pay off that balance.
Before switching:
- Check for any past-due amounts
- Set up a payment plan if needed
- Confirm there are no disputes on your account
Once your balance is clear, the switch can proceed normally. For the full removal process—including what happens if you’re on a payment plan—see this switch hold guide from our sister site NoDepositLights.
7. Assuming You’re in a Deregulated Area
Not every part of Texas gets to choose its electric company. Cities like Austin and San Antonio have municipal utilities, and El Paso is served by El Paso Electric, a regulated utility outside the ERCOT grid. Residents can’t shop around.
Check if you’re in a choice area:
- If your utility is Oncor, CenterPoint, AEP Texas, TNMP, or Lubbock Power & Light (since 2024), you can choose
- If your utility is Austin Energy, CPS Energy, or El Paso Electric, you cannot
- About 85% of Texas has choice. The other 15% doesn’t.
8. Not Setting Calendar Reminders
You’ll forget your contract end date. Everyone does.
What happens if you forget:
- You take the renewal offer in front of you, which is rarely the best available rate
- Or you do nothing and get moved to a month-to-month price that can change every billing cycle
Learn more about avoiding this trap in our guide on what happens when your electricity contract expires.
Set two reminders:
- 60 days before contract end: Start watching rates
- 30 days before: Begin shopping seriously
Future you will thank present you.
What Happens to Your Power During the Switch?
Nothing. Your lights stay on. Your AC keeps running. You won’t notice anything physically changing.
Why there’s no outage: The physical grid (poles, wires, transformers) is owned and maintained by your utility, not the company that sells you the electricity. When you switch, you’re only changing who bills you. The utility continues delivering power exactly as before.
No technician visits needed. No new equipment installed. No interruption to service. The switch happens at the billing level, not the infrastructure level.
What about smart meters? If you have a smart meter (most of Texas does), the switch is even simpler. The utility remotely updates your account. If you have an analog meter, someone might come read it, but your power stays on during that process.
Frequently Asked Questions
Can I switch electric companies anytime in Texas?
Yes, but you might pay an early termination fee if you’re in a fixed-rate contract. The penalty-free window is the last 14 days of your contract. Texas law also waives ETFs when you move to a new address.
How much does it cost to switch electric companies?
Switching itself is free. Your new company doesn’t charge you to sign up (unless there’s a deposit for credit reasons). The only potential cost is an early termination fee if you’re leaving a fixed-rate contract before it expires.
Will my power go out when I switch companies?
No. There’s zero service interruption during the switch. Your TDU (Oncor, CenterPoint, etc.) continues delivering power the entire time. The switch happens at the billing level only—no technician visit needed, no new equipment installed.
Do I need to call my current company to cancel?
No. Your new company handles all communication with the old one automatically. In fact, calling to cancel yourself can sometimes trigger unnecessary complications or fees. Just sign up with the new company and let them manage the transition.
When to Switch vs. When to Wait
Switch now if:
- You’re in your 14-day penalty-free window
- You’re moving to a new address (ETFs are waived)
- Your contract ended and you’re on a month-to-month price
- You found a plan that saves enough to offset the ETF
Wait if:
- Your current contract has more than 6 months remaining and you’d pay a large ETF
- You’re locked into a legitimately good rate (compare to current market)
- You’ll be moving in the next 2-3 months (wait and switch when you move)
Not sure? Do the math. Calculate your total cost (current plan + ETF) versus the total cost of switching (new plan savings × months remaining). If switching saves more than $100 over the remaining contract period, it’s usually worth it.
Next Steps: Ready to Switch?
The actual switching process is simple. The hard part is finding the right plan at the right price for your specific usage.
Your action plan:
- Find your current contract end date (check your bill or account portal)
- Set calendar reminders for 30 and 14 days before that date
- Calculate your average monthly usage from past bills
- Compare plans at your usage level
- Read the EFL for any plan you’re considering
- Sign up and let your new company handle everything
Want more context before you switch? Check our company comparisons to see how they stack up on customer service, not just rates. Or browse our best companies by category to find the ones that fit your specific needs.
Switching electric companies in Texas takes 15 minutes and costs nothing if you time it right. There’s no reason to stay with a company charging you more than you should pay.
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