Direct Energy Rates and Plans for Houston, Dallas, and the Rest of Texas.

Credit Check

Generally, all providers in Texas will perform a soft credit check when you place your order to determine if they require a deposit to start service. This is a 'soft' credit check and does NOT count as a 'hard check' on your credit report and will not affect your credit score. Most providers require your social security number, and perhaps a birthdate to process your order. Some providers can use alternate forms of identification such as a drivers license.

Deposits

Deposit amounts vary by provider, typically running somewhere between $150 and $450. There are certain cases where the deposit requirement can be wiaved, but you will have to provide additional documentation. Once the deposit is waived or paid, your service will start. You will earn a small amount of interest on your deposit. After 12 months, if your payments have all been made on-time, the provider will usually credit your deposit to your account balance. If you have completed the contract and do not owe the provider an outstanding balance, they will refund your deposit by check.

Switching Providers

Switching your electricity supplier in Texas is really easy. You simply place an order online for the provider of your choice.

During the order process, you will be given the opportunity to choose a date for the switch to occur. Generally, you can switch on the next business day, or perhaps the current business day if it is before noon or so.

If you don't select a switch date, then the switch will occur at the convenience of the utility company, which will likely be within 3-5 days.

You do not need to contact your current supplier. All the arrangements will be handled by your new supplier. For more details, you can use our blog article on "Switching your electricity supplier".

Moving In

Starting service is not much harder than switching. If the address you are moving into has had electrical service, you'll simply place an online order and select a date you wish to begin service. Usually, you can start the next business day.

However, if there is an issue with the meter at your new address, or if the meter has not been installed, it may take several days to get a crew out to rectify the problem.

If you think there is a potential problem with your meter at the new address, you should contact the supplier you have signed up with. They can contact ERCOT and the utility company to verify what is needed in your specific case.

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Early Termination Fee (ETF)

If you switch away from Direct Energy you will likely be charged an ETF (also known as a cancellation fee) unless you are on a month-to-month (no contract) plan.

These cancellation charges are allowed because Direct Energy has probably purchased electricity on the wholesale market to cover your expected usage, and if you leave, they are stuck with excess power that they have already paid for.

Late Charges

If you don't pay your bill by the due date, the provider is allowed to impose a late fee on your account. The late fee is limited to a percentage of your outstanding balance.

kWh (Kilowatt-Hours)

A 'kWh' or 'kilowatt-hour' is a measure of electricity usage. One 'kWh' is equal to a 1000 watt load operating for 1 hour. For example, a hair-dryer uses about 1200 watts of energy. If you divide the watts by 1000, you get kilowatts, so our hair dryer is using 1.2 kilowatts when running. Multiply 1.2 kW X 1 hour = 1.2 kWh. If your per-kWh electriciy rate is 15 cents, then running your hair dryer for an hour costs about 15 X 1.2 = 18 cents.

Average Bill

Most customers in Texas use about 1050-1400 kWh of electricity per month. According to various sources, the average electricity rate in Texas is about 11 cents. This would make the average Texas electricity bill about $115 to $154 per month.

Of course, if you have a higher electrical load than normal you will use more energy, and thus your bills can easily be higher than that. High load items would be things like a swimming pool or electric heat in the winter.

Your home size will have an impact on your usage. A smaller 600 sqft apartment might use 500-600 kWh, while an expansive 3,000 sqft. home could easily use 2,200 to 3,000 kWh.

Average Rate

Your bill will likely show an 'average rate per kWh' or some variation of that. The average rate is the total of your bill (including all fees and taxes) divided by your kWh usage. Generally, your average rate per kWh will be slightly higher when you use less electricity, because there are monthly fixed fees that don't change, so when you use less, the average goes up a bit. Don't confuse 'average rate' with your 'energy charge', which is the amount you are being charged specifically for the electricity you use, and is separate from fixed monthly customer fees.

Bill Period or Cycle

The dates this bill covers. Your Texas utility company will read the meter at their discretion. This will not always be a month or 30 days. If you are on a plan that has "monthly" fees, that fee will appear on your bill, regardless of how many days were within the period.

Energy Rate vs. Average Rate

the 'Energy Rate' is the price in cents that you pay your electricity provider for the actual electricity that you consumed. The 'Average Rate' is the total you paid for electricity service (including all TDSP fees, bill credits, taxes, etc) divided by the number of kWhs you used that month.

ESI ID (Electric Service Identifier)

This is the unique identifier of the electricity meter for your address. If you have multiple meters (one for the house, one for the shed) you will have multiple ESI IDs. Each ESI ID will generally get it's own bill, unless your current provider offers some sort of combined billing.

TDSP Fees

Fees are charged from the utility and are passed on to the retail electricity provider

TDSP fees can be a fixed charged per bill, or a variable charge based on how much electricity you used during that period. There are a few providers that offer "bundled" rates, which include these fees in their Energy Charge. In bundled rates, your actual average rate will not change during the course of your contract (assuming the plan has no monthly charge).

Some of the TDSP fees you may be charged are:

• Customer Charge
• Distribution Cost Recovery Factor
• Distribution System Charge
• Energy Efficiency Cost Recovery Factor
• Metering Charge
• Nuclear Decommissioning Fee
• PUC Assessment
• System Restoration Charge
• Transition Charge (1-5)
• Transmission Cost Recovery Factor
• Transmission System Charge

The TDSP fees charged and their amounts will vary depending on which TDSP services your area. As of May 2018, Oncor has the lowest per-bill charge at $5.25, while AEP-North has the highest, at $10.53 per bill. TNMP has the lowest average usage charges, at around 3.3¢/kWh, and CenterPoint is the highest, around 4.1¢/kWh.

Electric companies generally have the same energy charge applied, no-matter which TDSP the plan is in. The difference in the TDSP fees are the reason the same plan can cost around a penny higher in CenterPoint vs TNMP.