The Public Utility Commission of Texas (PUCT) mandates that every electricity plan has its own Electricity Facts Label (EFL) to summarize the key terms of the plan. The part people reference the most is the all-in rate at 500, 1000, and 2000 kWhs in a given month. As we explain below, these displayed rates can be highly misleading and you should never trust them when searching for a plan....until you've read all the fine print.

Never compare plans with different monthly terms (9-month vs 12-month)

Before we explain below, remember that you should never compare plans that have different monthly terms (ex: a 9-month plan vs a 12-month plan). This article explains why.

Don't search or sort plans by their displayed 500, 1000, and 2000 kWh rates

Electricity pricing is very complicated and a long time ago the PUCT decided the best way to show the rate of a plan was to display the all-in rate at a given kWh usage during a one-month period. This shows the all-in rate a customer would pay if they use EXACTLY 500, 1000, or 2000 kWhs in a given month. But if a customer’s usage happens to be a little more or a little less, like 950 kWhs or 1,050 kWhs for example, the effective rate is likely to be VERY different. Has this happened to you?

Electricity providers game this system by devising creative rate structures that often make plans look cheap but are actually very expensive. This means displayed rates at 500, 1000, and 2000 kWhs are mostly useless.

Here is an example of a real-life plan exhibiting this type of tricky rate structure (name withheld):

The right way to search for the best plan

The only way to truly find the cheapest plan for you is to know your usage, read the fine print of every electricity contract available, and calculate what you would pay on each one over the life of the contract. We call this the all-in rate and you can read more about that here. Determining this requires a lot of work and pretty much no one has time for that. But........good news!!! That's what our search engine does after you answer just a few questions. Check it out!

Email with questions.

Did this answer your question?