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Houston Electricity Rates: What You Should Know

Contrary to what you might be thinking, electricity rates in Houston aren’t something you can discuss in a rushed manner. A lot goes into how the rates get determined, how they change, and how to find the best one. A big part of the reason why electricity rates in Houston are such a complicated subject is because of deregulation.

Essentially, deregulation means that the electricity market in much of Texas is similar to the phone, TV, and internet market. There are dozens of companies trying to offer the best plans and the lowest prices, making it difficult to decide which company and plan are right for you. If you live in the Houston area and want to know more about the electricity rates and companies in your area, this article is for you.

What are the Average Electricity Rates in Houston?

The average electricity rate in Houston is right around 13 cents/kWh. However, if you contact us at EnerGenie for assistance finding your next electricity plan, we may find you a rate much lower. Electricity rates often depend on the structure of your electricity plan rather than the rate you see advertised. Typically, they increase or decrease dramatically depending on how much power you use and when you use it.

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Are Electricity Rates in Houston Different From Other Areas?

While Houston is unique from the rest of the country in many ways, its electricity is not. The rates and plans in Houston are very similar, if not identical, to most of the other major cities in Texas. A big reason for this is that many of the electricity companies in Houston offer plans to dozens of other parts of Texas. Because the companies are the same, the rates and plans are similar to the rest of Texas.

How do Electricity Rates in Houston Work?

Like we said before, electricity rates in Houston can be deceptive and tricky, and there’s more to consider than the rate you see listed next to your plan. You have tiered rates, hidden fees, and special features to watch out for.

Tiered Rates

Tiered rates are where you pay a different rate depending on how much electricity you use. For example, let’s say you sign up for a plan with a rate of 10 cents/kWh. What you won’t notice unless you read the details and fine print of the plan is that 10 cents only applies if you use a minimum of 2,000 kilowatt-hours.


Here’s how your rate is actually structured when it advertises a fixed rate of 10 cents/kWh.

Price per 2,000 kWhPrice per 1,000 kWhPrice per 500 kWh
10 cents15 cents20 cents


Essentially, your rate will jump 50% if you use between 1,000 and 2,000 kilowatt-hours and double if you use 500 kilowatt-hours or less.

For this reason, it’s vital that you understand how much electricity you use per month before signing up for a plan. This is something that EnerGenie takes into consideration when you contact us and allow us to find your electricity plan for you.

Hidden Fees

In addition to deceptive rates, electricity plans in Houston often have hidden fees that are only disclosed in the fine print of the plan.

Early Cancellation Fees

If you realize that you’ve signed up for a plan that doesn’t fit your needs or usage rates, you may be tempted to cancel the plan and find another. However, because power companies expect this to happen, they have hefty cancellation fees if you terminate your contract prematurely. EnerGenie can help you find ways around these fees or save you enough money on your new plan that they don’t matter.

Minimum Usage Fees

Plans that don’t have tiered rates will usually have minimum usage fees. With these fees, you’re penalized if you try to save electricity by using as little as possible. Sometimes, the fee is even more than what you would pay for electricity in the first place.

Delivery Fees

Delivery fees are paid for the service of having electricity delivered to your home. They go to support your local transmission and distribution utility company. Depending on your power company, delivery fees may or may not be factored into your overall plan.

Special Features

Because of how competitive the market is, power companies are constantly looking for an edge. They offer things like free electricity on weekends or evenings, free electricity beyond a certain usage point, and more. While some of these perks may seem tempting, they don’t always pay off, and you could end up spending more.

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Does My Type of Plan Affect My Electricity Rate in Houston?

The type of plan you sign up for most definitely affects your electricity rate in Houston. Fixed-rate plans are the most common and usually have the lowest rates. However, they also often have hidden fees and tiered rates built into them. Prepaid plans are next in popularity because of their convenience, but the rates are usually high.

Finally, you’ve got flat-rate plans where you pay a set rate every month regardless of the amount of electricity you use. Though these plans sound tempting, they rarely pay off, and you usually end up paying for more electricity than you use.

How to Get the Best Electricity Rates in Houston

If you’re feeling overwhelmed with the idea of researching the dozens of electricity companies and the many plans they offer, don’t be. EnerGenie is here to help! We have a series of smart algorithms and technology designed to find the perfect electricity plan for your home or business. All we need is your zip code and some information about your home and energy usage, and we will take care of the rest.

We consider everything when choosing your plan, including your budget, perks, and discounts offered by different companies and whether or not you want a green energy plan. From start to finish, EnerGenie is the best and easiest way to find your next great electricity plan. Whether you’re moving to Houston or simply want to pay less on your power bill, we’re here for you. Contact us to start the process today!

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