What the EFL Is and Why Texas Requires It
The Electricity Facts Label is a one-page disclosure document that every retail electricity provider in Texas must give customers before they sign a contract. The Public Utility Commission of Texas (PUCT) mandates the format under 16 Texas Administrative Code §25.475. The label exists because deregulation created dozens of competing plans with different rate structures, and without a standard document, comparing them is nearly impossible.
The EFL functions like a nutrition label for electricity. The categories are fixed. The layout is fixed. What changes is the numbers inside, and those numbers tell the whole story.
The Six Sections of Every EFL
1. Provider and plan identification
The top of the label names the Retail Electric Provider (REP), the specific plan name, and the provider's PUCT certificate number. That certificate number matters. A provider must maintain an active PUCT certification to operate legally in Texas. Shoppers can verify any certificate number at the PUCT's PowerToChoose.org database at no cost.
2. Average price at three usage levels
This is the most consequential section on the document. PUCT requires providers to disclose the all-in average price per kilowatt-hour at three monthly usage levels: 500 kWh, 1,000 kWh, and 2,000 kWh.
The three-column format exists because most plans do not charge a flat rate. A plan advertising 12.9 cents per kWh may carry a $9.95 monthly base fee. At 500 kWh, that fee adds roughly 2 cents to the effective rate. At 2,000 kWh, it adds less than half a cent. The price columns capture that spread in a single glance.
3. Pricing details
Below the three-column summary, the label breaks down how each price is constructed. This section discloses the energy charge (what the provider charges per kWh), any monthly base or customer charge, the transmission and distribution utility (TDU) pass-through charges for grid delivery, and any bill credits.
Bill credits are where shoppers most often get surprised. A plan might apply a $75 credit when usage exceeds 1,000 kWh in a month but charge a higher per-kWh rate outside that band. The 1,000 kWh column looks attractive. The 500 kWh and 2,000 kWh columns reveal what actually happens when usage shifts.
4. Contract terms
This section states the contract length (month-to-month or fixed at 6, 12, 24, or 36 months) and the early termination fee (ETF). Texas law caps ETFs at $250 for contracts of 12 months or shorter, but fees on longer contracts can run higher. A plan with a low energy charge and a $350 ETF is not a good deal for someone who may move in eight months.
5. Renewable content
PUCT requires disclosure of the percentage of electricity sourced from renewable generation. This figure reflects the REP's portfolio of Renewable Energy Certificates (RECs), not the physical electrons flowing to the house. The Texas grid (ERCOT) dispatches generation based on economics rather than any individual customer's contract. A plan showing 100% renewable content has purchased RECs equivalent to its total sales volume.
6. Terms of service reference
The label references the full Terms of Service and the Your Rights as a Customer (YRAC) document. Autopay requirements, paper billing fees, and deposit terms live in those documents, not on the EFL itself. Reading the Terms of Service before enrolling takes about 10 minutes and prevents most billing surprises.
How to Use the Three Price Columns
The average Texas household uses approximately 1,156 kWh per month, according to the U.S. Energy Information Administration (EIA, 2024 residential survey). That figure places most households nearest to the 1,000 kWh column. But averages mislead when individual usage varies sharply by season.
A Texas home running central air conditioning in July commonly uses 1,800 to 2,400 kWh. The same home in November may use 600 to 700 kWh. A plan offering a bill credit at exactly 1,000 kWh delivers that credit in neither summer nor winter.
The right approach: pull 12 months of usage history from SmartMeterTexas.com (the statewide meter data portal, free to access), identify the three or four months with the highest and lowest consumption, and check the EFL price column closest to each. That exercise often reverses the apparent ranking of two competing plans. A plan that appears 1.5 cents cheaper at 1,000 kWh may cost 3 cents more at 1,800 kWh.
Four Common Misreadings
Advertised rate versus EFL rate. Providers may legally advertise the 1,000 kWh average price in their marketing materials. That number is accurate at exactly 1,000 kWh but may not represent a typical customer's annual cost. The EFL is the authoritative source; the advertisement is not.
Ignoring TDU charges. The delivery charge from the local TDU is fixed regardless of which provider a customer chooses, but it varies by territory. Oncor's delivery rates differ from CenterPoint's. The EFL includes TDU charges in all three price columns, which is why comparing EFLs across different Texas cities requires care. A plan that appears cheaper in Dallas (Oncor territory) may look more expensive in Houston (CenterPoint territory) even when the energy charge is identical, because the TDU component differs.
Treating renewable percentage as a reliability signal. A plan with 100% renewable content is not more reliable than a 15% plan, and it does not change how ERCOT dispatches power to the grid. Customers who want to support renewable generation are making a legitimate choice. The EFL's renewable figure does not, however, indicate anything about rate stability or grid dependability.
Relying on an outdated EFL. Providers reprice plans frequently, sometimes weekly during volatile market periods. A PDF saved from a third-party comparison site may be weeks or months old. Always retrieve the current EFL directly from the provider's website or from PowerToChoose.org immediately before enrolling. The label's effective date appears at the top of the document.
What the EFL Does Not Cover
The EFL does not disclose everything a customer needs to know. It omits whether rates are fixed or indexed to the wholesale market (indexed rates can float; that term appears in the Terms of Service, not on the label), auto-renewal terms and required notice periods before contract expiration, late payment and paper billing fees, and deposit or credit check requirements.
For a straightforward fixed-rate plan with a clear ETF and no unusual conditions, the EFL provides enough information for a sound comparison. For variable-rate plans, prepaid plans, or plans with layered tier structures, the full Terms of Service is not optional reading.
A Five-Point Checklist Before Enrolling
Before signing any Texas electricity contract, confirm these items on the EFL:
- The price at the usage level matching the two or three highest-consumption months of the year
- Whether a bill credit applies and the exact kWh band that triggers it
- The contract length and the dollar amount of the ETF
- The TDU name listed (confirming it matches the service address)
- The EFL effective date (should be within the past 30 days)
That checklist takes five minutes. Skipping it costs some households $200 to $400 per year in avoidable rate mismatches, based on the spread between the top and bottom quartile of plans listed on PowerToChoose.org at any given time.
The EFL was built to close the information gap between providers and consumers. Reading it carefully, rather than relying on headline advertised rates, is the single most effective step a Texas household can take before signing an electricity contract.