When Do Texas Electricity Rates Go Up?

Most shopping guides tell you Texas electricity rates spike every summer. Three years of retail prices say otherwise.

Wholesale power for July and August does trade at a premium months ahead, and electric companies price that into the plans they sell. By the time it reaches a 12-month fixed rate, though, the premium is small and it does not show up every year. In 2024, signing in July instead of waiting for October cost about $270 over the following year. In 2025 that gap nearly vanished. In 2026, the cheapest plans of the year were on the board in July and August.

So the month on the calendar matters less than the folklore says. What still costs Texans real money is letting a contract expire and drifting onto month-to-month holdover pricing. Here is what the numbers actually show.

What the Rate Data Shows

Every monthly figure in this guide comes from one dataset: electricityplans.com’s historical table of the average price of a 12-month fixed plan at 1,000 kWh, energy plus delivery, month by month since 2021. It is the longest public record of what Texans could actually buy. Those are market averages, not the cheapest offer on the board; competitive 12-month fixed plans run about 12 to 15 cents per kWh as of September 2026.

Summer (June-August): Mixed, not peak. Air conditioning drives record demand across the ERCOT grid and wholesale prices climb, but retail plans do not always follow. Average 12-month rates hit 17.8 cents per kWh in July 2024, eased to 16.6 cents in July 2025, then fell to 15.3 cents in July 2026 and 14.2 cents in August 2026, the two cheapest readings of that year. What does rise every summer is your bill, because usage rises: the average Texas home uses about 1,537 kWh in August against 1,096 kWh across the year, which puts an August bill at roughly $230 to $290 on a competitive fixed rate.

Fall (September-November): Steady. Average 12-month rates ran 16.0 to 16.3 cents in the fall months of 2024 and 2025, and 15.0 cents in September 2026.

Winter (December-February): Moderate, with tail risk. Generally close to the middle of the year’s range, but severe cold snaps can send the wholesale market somewhere else entirely. Winter Storm Uri in February 2021 saw wholesale prices hit $9,000/MWh for several days.

Spring (March-May): No reliable discount. April 2026 averaged 15.4 cents, the low point of that year’s first half. April 2025 averaged 16.9 cents, the high point of all of 2025. Shoulder-season discounts, when they show up, run a few percent, not the 15 to 25 percent some shopping sites claim.

Month-by-Month Rate Guide

Here is what each month has actually produced.

January: High in Some Years, Lowest in Others

Average rate: 16.5 cents per kWh (January 2026, 12-month plans at 1,000 kWh, electricityplans.com)

Electric companies do price winter storm risk into January offers, but the premium is not visible every year. January 2026 was the most expensive month of that year at 16.5 cents. January 2024 came in at 16.5 as well, below that year’s July and August. January 2025, at 15.7 cents, was the cheapest month of its year. If your contract ends in January, shop it in January.

February-March: Quiet

Winter demand tapers off and offers settle back toward the middle of the year’s range. Neither month has produced an extreme in this dataset.

April: Depends Entirely on the Year

Average rate: 15.4 cents per kWh (April 2026); 16.9 cents in April 2025

April brought the lowest rate of the first half of 2026 and the highest rate of all of 2025. Spring is a fine time to shop. It is not a guaranteed discount, and any guide that promises one is not reading the data.

May: Middle of the Pack

Offers tick up modestly as companies hedge ahead of summer, and competitive deals stay on the board. Nothing in the record makes May a deadline.

June-August: Expensive in 2024, Cheapest in 2026

In 2024, July’s average (17.8 cents) ran about 9 percent above October’s (16.25 cents). In 2025 the same comparison was about 2 percent. In 2026, July (15.3 cents) and August (14.2 cents) were the cheapest months of the year.

The wholesale side: Summer on-peak wholesale prices can reach $110-165/MWh in July and August, according to forward contract data from early 2025. That is a real premium. It reaches retail slowly and only partly, because a company buying power for a 12-month product buys across all 12 months, not just the ones you happen to be shopping in.

What it means: Summer is the least predictable stretch to shop. It produced the worst prices of 2024 and the best prices of 2026.

September-October: Steady

Average rate in October: 16.25 cents per kWh (2024 and 2025); 15.0 cents in September 2026

October is a solid month to shop, though the data does not crown it the cheapest: December 2024 and August 2025 both came in below their Octobers. Air conditioning season is over, demand drops, and offers tend to sit near the middle of the year’s range.

November-December: Quietly Competitive

November and December averaged slightly below October in both 2024 and 2025. December 2024, at 15.9 cents, was the cheapest month of that year.

Why Summer Wholesale Prices Climb

Summer genuinely strains the ERCOT grid. Understanding what happens on the wholesale side explains both where the folklore came from and why so little of it reaches your fixed rate.

Record-Breaking Demand

In 2023, ERCOT set a then-record 85,464 MW on August 10 as Texas temperatures soared, and it broke that again with 91,134 MW on July 22, 2026 (unofficial until final settlement). When everyone runs their air conditioners at once, the grid strains to meet demand. Wholesale prices respond accordingly: spikes above $1,000/MWh occurred 182 times in the summer 2023 real-time market (June through August, 15-minute intervals), compared to 73 times in summer 2022, according to the Dallas Fed.

Supply Constraints

During extreme heat, some power plants run at reduced capacity or shut down under heat stress. That trims supply exactly when demand is highest, pushing prices up further.

Forward Hedging

Electric companies buy power on the wholesale market months in advance to hedge their exposure. Summer months trade at a premium because everyone knows demand will be high. Those costs get spread across the full term of the plans they sell, which is why a July wholesale spike shows up as a fraction of a cent on a 12-month retail rate rather than as a spike of its own.

The Winter Storm Wild Card

While summer carries the best-known price risk, winter carries the ugliest one. Most years, winter rates are unremarkable. But severe cold events can break the wholesale market.

Winter Storm Uri: The $9,000/MWh Event

In February 2021, Winter Storm Uri sent wholesale electricity prices to the maximum cap of $9,000/MWh. Customers on wholesale-indexed plans saw bills of thousands of dollars. The storm caused $80-130 billion in economic losses, by the Dallas Fed’s estimate.

Post-Uri, the state regulator (PUCT) cut ERCOT’s price cap to $5,000/MWh (approved December 2021), still high enough to devastate anyone on an unprotected plan. Wholesale-indexed residential plans have since been barred in Texas, so today’s shopper cannot sign one, but the episode is a reminder of what a fixed rate protects you from.

Current Winter Risk

Five years post-Uri, challenges remain. Rising demand from AI data centers and cryptocurrency operations puts additional strain on the grid. According to NERC’s 2025-2026 Winter Reliability Assessment, in a Uri-like storm, power demand could reach 85.3 GW, leaving the state 14.9 GW short of its 70.4 GW of available resources.

The takeaway: Winter rates are usually moderate, but an unexpected cold snap is the one event that can move prices violently. A fixed-rate contract is what keeps that off your bill.

Which Months Have Actually Been Cheapest

Among the months this guide tracks, the cheapest one was different every year:

2024: December, at 15.9 cents. The most expensive was July, at 17.8.
2025: January, at 15.7 cents. The most expensive was April, at 16.9.
2026 so far: August, at 14.2 cents. The most expensive was January, at 16.5.

No month repeats. The whole spread inside a year has run about 1.2 to 1.8 cents per kWh, which is $12 to $18 a month at 1,000 kWh. That is worth having, but it is not the difference between a good decision and a bad one.

The useful comparison is not “is it October?” It is “is this offer near the low end of what the market is showing right now?” Competitive 12-month fixed plans have been running about 12 to 15 cents per kWh. An offer at the bottom of that band in any month beats an average offer in a supposedly cheap one.

The One Timing Penalty Worth Naming

Only 2024 produced a summer premium big enough to plan around.

Signing in July 2024 at the 17.8-cent average, when waiting until October would have meant 16.25 cents, cost about $23 a month at 1,500 kWh, roughly $270 over a year. That is the largest timing penalty in three years of data, and it did not repeat in 2025 or 2026.

For comparison, letting a 12-month contract lapse onto month-to-month pricing typically costs 2 to 4 cents per kWh, which is $20 to $40 a month at 1,000 kWh for as long as you stay there. The lapse costs more than the season, every year.

How to Time Your Contract

Shop on Your Contract’s Schedule, Not the Calendar’s

The seasonal spread is worth a cent or two. Holdover pricing is worth several. Riding a month-to-month plan for three months to reach a “better” season usually costs more than the season saves. Shop when your contract ends.

Start 30 to 45 Days Before Expiration

Most electric companies let you schedule a switch 60 to 90 days in advance (Reliant allows up to 60 days; TXU Energy, Gexa, and Frontier up to 90). Start watching offers a month or so out, then schedule the switch inside the final 14 days of your current contract, when no early termination fee can apply.

Use Odd Terms to Move Your Renewal Month

Most contracts run 6, 12, 24, or 36 months. If you want your next expiration to land in a particular month, an off-cycle term such as 9, 13, or 14 months (Rhythm Energy’s Simply Select 9 and Simply Green 13 are examples) will shift it. Treat that as a scheduling tool, not a savings strategy.

Don’t Let Your Contract Lapse

When a fixed contract expires, you move onto a month-to-month default renewal product under PUCT rules (16 TAC 25.475). It carries no cancellation fee, but its price can change every billing cycle and it usually sits well above the fixed rates you could get by shopping. Your company has to send you at least three written notices during the final third of your term, with the last one at least 30 days before expiration. Act on them.

For more on this, see our guide on what happens when your electricity contract expires.

Wholesale Market Trends to Watch

Retail rates follow wholesale trends, but over years rather than months. That is the trend worth tracking.

The 2026 and 2027 Outlook

In January 2025, the EIA expected ERCOT wholesale prices to average about $30/MWh in 2025, down from around $35/MWh in 2024, thanks to new solar. It has since reversed course: its November 2025 outlook projected ERCOT North prices to rise roughly 45 percent in 2026 on summer peak-hour spikes, and its February 2026 outlook put the 2027 baseline near $47/MWh, with a data-center-heavy scenario about 79 percent above that. Forward contracts were already trading above $50/MWh in early 2025, with summer on-peak months reaching $110-165/MWh.

What this means for you: Wholesale costs are climbing again. That pressure builds over years, which is a better argument for locking a longer term than any seasonal pattern is.

Long-Term Trends

From January 2021 to December 2024, the average price for a 12-month electricity plan rose from 10 cents/kWh to nearly 16 cents/kWh, a 60% increase over four years (electricityplans.com, 1,000 kWh, delivery included).

The EIA puts Texas’s average residential price at 15.94 cents per kWh for June 2026, up 4.5 percent from 15.26 cents in June 2025 (Electric Power Monthly, Table 5.6.A), with 12-month plans in the deregulated areas averaging 14.3 to 16.7 cents including delivery as of September 2026, depending on the delivery utility.

The takeaway: Rates have climbed more from year to year than they move inside a single year. When you find an offer near the low end of the current market, how long you lock it matters more than which month you signed.

Choosing a Contract Length

When Current Offers Look Cheap

Lock in longer, but only if the longer term is actually priced lower. In September 2026 it was not: average 24-month and 36-month offers priced above 12-month offers. Check the spread before you assume a discount. Large companies like TXU Energy and Reliant Energy offer 24- and 36-month fixed plans.

Example: If you lock 15 cents/kWh on a 24-month plan in October 2026, you are covered through October 2028 at a price you already know is competitive.

When Current Offers Look Expensive

Go 12 months, not month-to-month. A month-to-month plan costs 2 to 4 cents per kWh more than a fixed plan, so “waiting it out” is usually the more expensive move. Month-to-month plans are the right tool when you genuinely need flexibility, such as a move or a lease ending, not when you are trying to outguess the market.

When You Can’t Tell

Twelve months is the default for a reason. It is the most shopped term in Texas, it carries the smallest early termination fee ($150 on most plans), and it puts you back in the market often enough to catch a better price.

How Weather Events Affect Rates

Texas electricity rates are unusually exposed to extreme weather because the ERCOT grid is isolated from the rest of the country. We can import only a small amount through a handful of DC ties during a crisis, so local weather has outsized effects.

Heatwaves

Extended stretches above 100°F push ERCOT demand to record levels. In 2023, summer heat drove multiple price spikes above $1,000/MWh in real-time markets.

Retail rate impact: companies hedge ahead of summer, and a hot forecast raises what they pay for power. How much of that reaches a 12-month retail rate varies a lot. In 2024 it showed up as about 9 percent. In 2026 it did not show up at all.

Winter Storms

Severe cold threatens the natural gas infrastructure that fuels many Texas power plants. When wellheads and pipelines freeze, fuel cannot reach plants, cutting supply exactly when heating demand spikes. That is what happened during Winter Storm Uri.

Retail rate impact: companies price winter risk into January offers, though the effect is inconsistent. January was the most expensive month of 2026 and the cheapest month of 2025. During Uri itself, customers on wholesale-indexed plans got bills of $5,000 to $9,000 for a single week; those plans are no longer sold to Texas households. For more on how plan types handle this risk, see our fixed vs variable rate plans guide.

Grid Improvements Since Uri

Since 2021, more than 60,000 MW of capacity has been added to the ERCOT grid: about 31 GW of solar, 17 GW of batteries, 11 GW of wind, and 3 GW of natural gas as of mid-2026 (Texas Public Policy Foundation tally of ERCOT data). Much of it is renewable generation plus batteries, which store power and release it during peak demand.

The grid is more resilient than it was during Uri. Significant challenges remain, especially with rising data center demand.

Action Plan: What to Do and When

Your Contract Ends in the Next 45 Days

Compare offers now, whatever month it is
Look at 12-, 24-, and 36-month plans side by side and check whether the longer terms are actually cheaper
Read the Electricity Facts Label at your real usage, not at 1,000 kWh out of habit
Schedule the switch inside your final 14 days, when no early termination fee applies

Your Contract Ends Later This Year

Put the end date on your calendar now with a reminder 45 days out
Watch where competitive offers sit so you recognize a good one when it is time
Do not pay an early termination fee to move early unless the math clears it (see below)

Your Contract Already Expired

You are on month-to-month holdover pricing, which is the single most expensive place to sit
Shop today, in whatever month it is
Any competitive fixed rate beats staying there another billing cycle

For step-by-step instructions on switching, see our guide on how to switch electricity companies.

Should You Switch Mid-Contract to Get a Better Rate?

Say your contract has months left, but current offers are well below what you are paying. Is it worth an early termination fee (ETF) to move now?

Sometimes. Here is the math:

Your current plan: 15 cents/kWh, 9 months remaining, $150 ETF

Available plan: 12 cents/kWh, 12-month fixed

Your usage: 1,500 kWh/month

Monthly savings: $45/month

Break-even point: $150 ETF ÷ $45/month = 3.3 months

In this scenario you break even in about three months and save about $390 over the next 12 months after paying the fee ($540 in lower bills minus the $150).

When it makes sense:

A gap of 3 cents/kWh or more
The new offer sits near the low end of the current market
Your ETF is the standard $150 rather than a 24-month or 36-month fee
You have many months left on your contract

When it doesn’t:

A gap of 1 to 2 cents/kWh
A large ETF relative to the savings
You are within three or four months of expiration anyway, when you can leave fee-free in the final 14 days

For more on this calculation, see our guide on the best time to switch electricity companies.

The Shopping Checklist

Find your current contract end date right now (it’s on your bill)
Add it to your calendar with reminders at 45 and 30 days before
Note what competitive 12-month plans are running today so you have a benchmark
Start comparing 30 to 45 days before expiration, whatever the season
Compare 12-, 24-, and 36-month offers and confirm whether longer is actually cheaper
Compare total cost at your real usage, not just the advertised rate
Check the early termination fee before you sign
Lock in your new plan and schedule the switch for your fee-free window (final 14 days)
Set a reminder for your next expiration so you never land on holdover pricing

Bottom Line: Shop on Schedule, Not on Season

Texas electricity rates move with the seasons far less than the shopping folklore claims. In three years of retail price data, the cheapest month was December once, January once, and August once, and the most expensive was July once, April once, and January once.

What the season is worth: a cent or two per kWh. The one big exception was July 2024, when signing at the peak instead of waiting for fall cost about $270 over the following year. That spread did not repeat in 2025 or 2026.

What your bill does in summer: it rises, because you use more electricity, not because your rate jumped. An August with 1,500 kWh on the meter costs more than an April with 1,000 kWh at exactly the same rate.

What actually costs money: letting a contract expire onto month-to-month holdover pricing, which runs 2 to 4 cents per kWh above a fixed plan for as long as you sit there.

Shop when your contract ends. Compare the offer in front of you against what the market is showing that week. Lock the longest term you are comfortable with, if and only if the longer term is actually priced lower.

Ready to compare rates? Check current pricing at ComparePower.com. And if you’re trying to decide between companies, start with our company comparisons to see how they stack up on rates, customer service, and reliability. A popular one is TXU vs Reliant, two of the largest electric companies in Texas.

For more on managing your electricity costs, see our guide on how to lower your electric bill in Texas and our breakdown of average electricity usage in Texas.

Frequently Asked Questions

What month has the highest electricity rates in Texas?

It changes from year to year. July was the most expensive month of 2024 (17.8 cents on average for a 12-month plan), April was the most expensive of 2025 (16.9 cents), and January was the most expensive of 2026 through September (16.5 cents). No single month has been reliably high, which is why picking a month is a weak shopping strategy.

How much more expensive is summer electricity in Texas?

In 2024, July’s average 12-month rate ran about 9 percent above October’s, roughly $23 a month at 1,500 kWh. In 2025 the gap was about 2 percent, and in 2026 July and August were the cheapest months of the year. Your summer bill still climbs, but that is usage, not the rate.

Should I sign a long-term electricity contract?

Only when the longer term is actually priced lower, which is not automatic. In September 2026, average 24-month and 36-month offers priced above 12-month offers. When a longer term does come in cheaper and you expect to stay put, locking it protects you from the year-over-year climb in Texas rates.

When should I start shopping for a new electricity plan?

Start comparing 30 to 45 days before your contract expires, in whatever month that falls. Schedule the switch for the final 14 days of your contract, when no early termination fee can apply.

When Do Texas Electricity Rates Go Up? What the Data Shows