How Much is Electricity in Texas?
As of September 2024, the average rate for residential electricity in Texas, including both regulated and deregulated markets, is 14¢ per kilowatt hour. According to EnergySage, this is 28% lower than the national average of 19¢.
However, the average electricity bill in the Lone Star state is higher than the national average, because we Texans tend to consume a lot of energy. In fact, we spend around $246 every month, which adds up to $2,952 per year. Over the coming 25 years, Texans should plan to spend around $99,700 on your electric bills.
Curious to see a month by month breakdown of the average price of electricity, detailed by state? Visit the U.S. Energy Information Administration’s Electricity Data Browser.
Factors Influencing Electricity Costs
So what determines the price of electricity? First of all, there are fuel costs, which are particularly pertinent when it comes to energy produced by burning coal or natural gas. Second, extreme weather events can have an impact on the cost of electricity, for example when an ice storm slows or halts production due to freezing equipment or downed power lines. And third? Market demand. At certain times of the year, or even of the day, more people are using electricity, and so the cost rises.
Common Energy Plan Types for Texas Homeowners
Most Retail Electric Providers (REPs) offer several types of plans, which fall into two broad categories. Fixed rate plans are exactly that: they fix the rate you pay for electricity for the lifetime of your contract, which is typically 12, 24, or 36 months. This enables homeowners to know what to expect on their bills, and plan accordingly.
Variable rate plans, on the other hand, have rates that fluctuate based on the cost of energy on the wholesale market. These are good for consumers who are savvy at managing their electricity consumption and may even like watching trends in the energy market, to see how their bills may be affected.
It’s worth noting that renewable energy plans also can have an impact. The adoption of renewable energy typically leads to a reduction in electricity costs, because the cost of generating energy with solar and wind resources has significantly dropped in recent years, and is often less than that with fossil fuels.
At Rhythm Energy, our PowerShift plans are highly popular fixed rate plans that let you shift energy use to off-peak hours and enjoy the lowest daytime rates in the state. And because they come from us, you can rest in the knowledge that 100% of the energy you use is generated using renewable resources.
How to Reduce Energy Costs in Texas
If you’re looking to reduce your energy bills, it helps to understand your usage patterns and their impacts on costs. By comparing past electricity bills, particularly at different times of the year, you can get a sense of how much energy you consume and modify your behaviors.
For instance, adjusting your air conditioning during the hot Texas summer can really add up: it’s estimated that for every 1 degree you raise your thermostat, you will save around 6% in energy use. Industry experts recommend that you set your indoor temperature at 78° in the summer and 68° in the winter, to help you save. If you don’t like those temperatures, then follow the “4x4 Rule”: if no one is going to be home for more than 4 hours, then set the thermostat 4 degrees warmer in the summer and cooler in the winter. Then re-adjust it back when you get home.
Once you understand your consumption, you can choose the plan that works best for you. It might be a fixed rate plan, where you lock in rates for the lifetime of the contract. Or a variable rate plan, where your rate is determined on a month-to-month basis by the cost of energy on the wholesale market. Or even a time of use plan, where you are charged less for energy during off-peak hours, and so can shift your usage away from on-peak hours (between 6 and 10 pm).
For more tips, from smart thermostats to appliances, weatherproofing your home, and many others, visit our article How to Save on Energy in Texas (Cut Your Bill Today).
Find Your Perfect Plan at Rhythm Energy
At Rhythm Energy, we’re committed to bringing you energy that is not only 100% renewable, it’s also affordable and backed by our award-winning customer service. To find out what plans are available in your area, visit gotrhythm.com and enter your zip code.
FAQs
What is the current average monthly cost of electricity in Texas?
On average, Texans spend around $246 every month on electricity.
What factors affect electricity pricing in Texas?
The cost of fuel to generate electricity, extreme weather events, and demand all contribute to the pricing of electricity.
Are there any seasonal variations in electricity costs?
Absolutely. Rates are higher during the peak of summer and the very coldest parts of winter.
