Welcome to Texas. The electricity industry is waiting to take advantage of you.
That sounds harsh, but it’s true. Newcomers are the most profitable customers in the Texas electricity market. You don’t know the seasonal rate patterns. You don’t know which advertised rates are lies. You don’t know that the big-name providers—the ones with stadium sponsorships and TV commercials—often charge 20-30% more than competitors for identical electricity.
The Texas market is designed to reward informed consumers. It’s also designed to punish people who sign up without doing homework. Let’s make sure you’re in the first group.
Texas Electricity Is Different: Deregulation Explained
In most states, you get electricity from one local utility. They set the rates. You pay the bill. No choices to make.
Texas did something different in 2002. The state separated the companies that sell electricity (Retail Electric Providers, or REPs) from the companies that deliver it (Transmission and Distribution Utilities, or TDUs). This created a competitive market where providers compete for your business.
What this means for you:
- You must choose an electricity provider before you can turn on the lights
- Over 100 companies want to sell you power, with rates and plans that vary wildly
- The physical delivery of electricity stays the same regardless of who you choose
- You’re responsible for shopping, comparing, and managing your electricity contract
The good news: Competition keeps prices relatively low. The cheapest rates in Texas are genuinely competitive with anywhere in the country.
The challenge: With over 100 providers and thousands of plans, finding the right one takes work. The most-advertised companies aren’t necessarily the best value.
Not All of Texas Is Deregulated
Before you dive into comparing providers, check if your new address is even in a deregulated area.
Deregulated areas (you choose your provider): Most of Dallas-Fort Worth, Houston, Austin suburbs, Corpus Christi, and other major metros served by Oncor, CenterPoint, AEP Texas, or TNMP utilities.
Regulated areas (no choice): San Antonio (CPS Energy), Austin city proper (Austin Energy), Lubbock (LP&L), El Paso (El Paso Electric), and most rural electric cooperatives.
If you’re moving to a regulated area, you’ll contact that single utility directly. No shopping required. The rest of this guide applies to the roughly 85% of Texas where you have choices.
Timeline: When to Start Setting Up Electricity
Don’t wait until moving day. Start the process at least two weeks before you need power.
2-4 Weeks Before Move-In
Research and compare providers. This is where you’ll spend most of your time. Look at plans, read reviews, and understand what different providers offer.
What to do:
- Determine your new address’s utility (Oncor, CenterPoint, AEP Texas, or TNMP)
- Research providers that serve your area
- Compare rates at different usage levels
- Read the Electricity Facts Label (EFL) for any plan you’re considering
1-2 Weeks Before Move-In
Choose your provider and sign up. Once you’ve done your research, enrollment takes about 15 minutes online.
What to do:
- Select your provider and plan
- Have your move-in date ready
- Prepare for a credit check (or have deposit funds ready)
- Sign up online or by phone
- Request a specific service start date
3-7 Days Before Move-In
Confirm your service. After signing up, you should receive confirmation from your new provider.
What to do:
- Verify your start date in your confirmation email
- Save your new account number
- Set up online account access
- Consider enrolling in autopay (some providers offer discounts or waive deposits)
Move-In Day
Power should be on when you arrive. If you scheduled correctly, you won’t need to do anything.
If power isn’t on:
- Call your provider’s customer service line
- Have your account number and service address ready
- Same-day activation is often possible if there’s an issue
What You Need to Sign Up
Gather these before you start comparing plans:
Your new address details:
- Full street address with apartment number (if applicable)
- Move-in date
- ESI ID (Electric Service Identifier) if available—your landlord or the previous tenant may have this
Personal information:
- Full legal name (as it appears on your ID)
- Social Security Number (for credit check)
- Contact phone number and email
- Previous address (for credit verification)
If you don’t have an ESI ID: Don’t worry. Most providers can look it up using your street address. The ESI ID is a 17 or 22-digit number that identifies your specific service location. If you want to find it ahead of time, use an ESI ID lookup tool with your new address.
How to Choose Your First Texas Provider
With over 100 providers competing for your business, the options can feel overwhelming. Here’s how to narrow it down.
Step 1: Estimate Your Monthly Usage
Your usage determines which plans work best for you. Plans are priced differently at different consumption levels—a plan that’s cheap at 2,000 kWh might be expensive at 1,000 kWh.
If you’re coming from a similar climate: Use your previous home’s electricity bills as a baseline.
If you’re new to Texas heat: Texas summers are brutal. A typical 2,000 square foot home in Texas uses:
- Winter: 800-1,200 kWh/month
- Summer: 1,500-2,500 kWh/month
- Annual average: About 1,200-1,500 kWh/month
Apartments use less. Larger homes use more. Older homes with poor insulation use significantly more in summer.
Step 2: Decide What Matters Most
Different providers excel at different things:
Lowest price: Budget providers like Gexa Energy, 4Change Energy, or Frontier Utilities focus on competitive rates with fewer frills.
Green energy: If renewable energy matters to you, Green Mountain Energy, Chariot Energy, or Rhythm Energy specialize in 100% renewable plans.
Name recognition: TXU Energy and Reliant Energy are the biggest names in Texas. You’ll pay more, but they have extensive customer service infrastructure.
Flexibility: If you’re uncertain about your new location and might move again, look for providers with short contracts or low early termination fees.
No credit hassles: If your credit isn’t great, providers like Payless Power offer prepaid options that skip the credit check entirely. Learn more in our prepaid vs traditional electricity guide.
Step 3: Read the Electricity Facts Label (EFL)
Every Texas electricity plan comes with an EFL—a standardized document that shows what you’ll actually pay. This is more important than any advertised rate.
What to look for in the EFL:
Average price at 500, 1,000, and 2,000 kWh: This shows how the plan performs at different usage levels. Compare these numbers at your expected usage, not just the lowest number advertised.
Base charges: Many plans have a monthly fee regardless of usage. A “$9.95 customer charge” on a low-rate plan might make it more expensive than a higher-rate plan with no base charge.
Contract length: Plans range from month-to-month to 36 months. Longer contracts often have lower rates but less flexibility. Understand the tradeoffs in our fixed vs variable rate guide.
Early termination fee (ETF): What does it cost to leave early? Flat fees of $100-150 are common. Some plans charge per remaining month ($15-20 × months left).
Renewable content: What percentage comes from renewable sources? Required disclosure in Texas.
Step 4: Compare Plans at Your Usage Level
Don’t chase the lowest advertised rate. That number is often the rate at exactly 1,000 or 2,000 kWh—not your actual usage.
Use ComparePower to compare plans at your expected usage level. Enter your address and estimated consumption to see real costs, not marketing numbers.
For more context on specific providers, check our provider comparisons to see how companies stack up on customer service and reliability, not just price.
Deposits and Credit Checks: What to Expect
Most Texas electricity providers will run a credit check when you sign up. This determines whether you’ll need to pay a deposit.
How Credit Checks Work
Providers use your Social Security Number to check your credit history. Unlike applying for a loan, electricity credit checks are typically “soft” inquiries that won’t hurt your credit score.
Good credit (typically 650+): No deposit required. You’ll sign up and start service normally.
Fair credit (550-649): You may need a deposit, typically $100-200. Some providers waive this with autopay enrollment.
Poor credit (below 550) or no credit history: Expect a deposit of $200-400. Or consider prepaid plans that skip the credit check entirely.
How to Avoid or Reduce Deposits
Enroll in autopay: Many providers waive or reduce deposits if you set up automatic payments from a bank account or credit card.
Provide a letter of credit: If you had electricity service in another state with no late payments, request a letter of credit from your previous provider. Many Texas REPs will waive the deposit with proof of good payment history.
Choose a prepaid plan: Providers like Payless Power and Acacia Energy offer prepaid electricity. You pay in advance, so there’s no credit check and no deposit. You add funds as needed, similar to a prepaid phone.
Ask about deposit alternatives: Some providers accept a surety bond or allow you to pay a smaller upfront amount with the rest spread across your first few bills.
Getting Your Deposit Back
If you do pay a deposit, it’s not gone forever. Texas regulations require providers to return deposits (with interest) after 12 months of on-time payments. Make sure you’re set up for autopay or payment reminders so you don’t miss a payment and reset the clock.
Common Mistakes Newcomers Make
After helping thousands of people navigate Texas electricity, we see the same mistakes over and over. Here’s how to avoid them.
Mistake #1: Choosing Based on the Advertised Rate Alone
That “7.9 cents per kWh!” you saw advertised? It’s probably only that cheap at exactly 2,000 kWh usage. Use 1,500 kWh and you might pay 11 cents. Use 800 kWh and you might pay 15 cents.
The fix: Always check the EFL for rates at multiple usage levels. Calculate your actual expected cost, not the marketing number.
Mistake #2: Not Understanding Contract Terms
Many newcomers sign up for the first decent-looking plan without reading the contract. Then they’re shocked by a $200 early termination fee when they want to switch.
The fix: Before signing, know:
- Contract length (how long you’re committed)
- Early termination fee (what it costs to leave early)
- What happens at contract end (auto-renewal terms, month-to-month rate)
Mistake #3: Assuming Bigger Is Better
TXU and Reliant advertise everywhere—billboards, TV, stadium naming rights. Many newcomers assume the biggest names must be the best.
The reality: Marketing costs money, and that cost gets passed to you. Smaller providers often offer identical electricity at lower prices. The power flowing through your wires is the same regardless of which company sends your bill.
The fix: Compare actual rates and reviews, not brand recognition. Our provider comparisons can help you see how big names stack up against lesser-known options.
Mistake #4: Not Planning for Texas Summer
If you’re moving from a milder climate, Texas summer will shock you—both the heat and the electricity bill. June through September can double or triple your usage compared to spring.
The fix: Plan for high summer usage when choosing plans. A plan that looks cheap at 1,000 kWh might be expensive at 2,500 kWh. Consider a fixed-rate plan that protects you from seasonal price spikes.
Mistake #5: Waiting Until Moving Day
Electricity service in Texas requires advance setup. If you call on moving day, you might get same-day service—or you might spend your first night without air conditioning.
The fix: Start comparing plans 2-4 weeks before your move. Sign up at least a week ahead with a specific start date.
Mistake #6: Forgetting to Set Calendar Reminders
Your contract will end in 12, 24, or 36 months. When it does, you’ll either auto-renew at whatever rate your provider chooses (rarely the best available) or get moved to expensive month-to-month rates.
The fix: The day you sign up, set two calendar reminders:
- 60 days before contract end: Start watching rates
- 30 days before: Begin shopping for your next plan
Mistake #7: Choosing Variable Rates Without Understanding the Risk
Variable-rate plans look cheap initially. But “variable” means your rate can change monthly based on market conditions. During Texas summer or grid emergencies, variable rates can spike dramatically.
The fix: If you’re new to Texas, start with a fixed-rate plan. You’ll pay a small premium for price certainty, but you won’t get surprised by a $500 bill when the first heat wave hits.
What About Apartments and Rentals?
Setting up electricity in a Texas apartment works the same as a house, with a few extra considerations.
Check your lease: Some apartment complexes have master-metered electricity, meaning your landlord pays the electric bill and charges you a flat fee or includes it in rent. If that’s your situation, you can’t choose a provider.
Get the ESI ID: Your leasing office should have this. It speeds up the enrollment process significantly.
Consider shorter contracts: If your lease is 12 months, a 12-month electricity contract keeps things simple. Texas law lets you cancel without ETFs when you move, but matching your contract to your lease avoids the hassle of transferring service or losing a good rate if your next place has different metering.
Ask about move-in specials: Some providers offer incentives for apartment dwellers, including waived deposits or bill credits for new movers.
Quick Reference: First-Time Setup Checklist
Use this checklist to make sure you don’t miss anything:
- Confirm your new address is in a deregulated area
- Identify your utility (Oncor, CenterPoint, AEP Texas, or TNMP)
- Estimate your monthly electricity usage
- Research and compare at least 3-5 providers
- Read the EFL for your top choices
- Calculate actual costs at your expected usage level
- Check contract length and early termination fees
- Gather your personal information (SSN, previous address)
- Sign up at least 1 week before move-in
- Confirm your start date in writing
- Set calendar reminders for contract expiration
- Set up online account access
- Consider autopay for potential deposit waiver or discount
Welcome to Texas
The Texas electricity market can feel overwhelming at first, but it rewards people who do a little homework. The competitive market means you have access to some of the best rates in the country—if you know how to find them.
Take the time to compare before you sign up. Read the EFL, not just the ads. Set reminders so you don’t get stuck on expensive rates when your contract ends.
Ready to start comparing? Browse plans on ComparePower to see what’s available at your new address. Or check our provider comparisons to learn more about specific companies before you choose.
Welcome to Texas. Mind the heat. And don’t forget to shop your electricity.