Why is the Energy Charge on the Texas EFL is Important

by | Jul 21, 2023 | Industry News

What Is An Energy Charge?

Learn why the energy charge really matters on your plan's EFL. Find out how it affects your charges for tiered and bill credit plans.
EFLs can really complicate your power to choose a new plan. Find out why the energy charge is the most important and how it affects your monthly bill.

Understanding electricity costs can be confusing. Whether you’re reading legalese or scientific terms, it can be hard to parse power contracts. But one important factor to consider is the energy charge. This charge plays a crucial role in determining your total cost. In short, energy charges are what you really pay for the power you use. 

Each plan’s electricity facts label (EFL) outlines cost for your how monthly power bills. Delivery charges and energy charges make up the bulk of costs. Under Texas law, everyone served by a transmission and distribution utility (TDU) like Oncor and CenterPoint pays the same delivery charges. But you have the power to choose your retail power provider.

The energy charge is the cost for the actual electricity supply in cents per kilowatt-hours (kWh). And that charge on your monthly bill will increase in proportion to your power usage.

The good news is that you have control over your energy charges. But how do retailers figure these charges? 

Understanding Your Plan’s Energy Charge

The energy charge is the amount you pay for the actual power you consume in kWh. For most Texas power plans, the energy charge is the electric rate (the cost per kWh) times the amount of power you use during a billing cycle. For example, using 1,000 kWh at 12 cents yields a $120 charge. 

The math can vary based on the specific energy plan you have. Bill credits and tiered rates can swing your energy charge greatly. A change in 1 kWh of usage could mean a wild difference in a month’s bill. Free nights and weekends plans charge higher rates during certain times to trade off with free power periods. Under these plans, when you use power dictates how much your energy charge will be. 

Why is it crucial to understand the energy charge? Well, it directly impacts your electricity expenses. By knowing how it’s calculated and what factors influence it, you can make informed decisions to manage your energy usage  and save money.

Other Texas EFL Charges

Confused by the energy charge? See how we help make sense of your power to choose.
A Texas electricity plan’s energy charge can be a deciding factor when it comes to your power to choose.

Remember, the energy charge is just one part of your electricity bill. Other charges such as delivery charges, taxes, and service fees also contribute to the total cost. Most electricity providers offer online portals or mobile apps that provide detailed data to help you track your usage and costs. These tools enable you to understand your energy patterns, set energy-saving goals, and monitor your progress.

Best Home Energy Plans 

Comparing energy plans is also beneficial. Different providers may offer various energy rates, so taking the time to research and choose the best plan for your needs can result in significant savings. Shop for the best plans at https://www.texaselectricityratings.com. Here you’ll find each plan’s charges clearly outlined. With this data, you can make an informed decision for your home. 

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