What a TDU actually does
Transmission and Distribution Utilities (TDUs) own the poles, wires, and meters. They don’t sell you electricity (your retail provider, or REP, does that), but they physically move the electrons from generation to your house.
In Texas, you cannot choose your TDU. It’s determined by your address. Oncor serves most of North and West Texas (including Dallas, Fort Worth, and the Permian Basin). CenterPoint serves most of the Greater Houston area.
The tariff breakdown
Every TDU files an annual tariff with the Public Utility Commission. The 2026 numbers:
| Component | Oncor | CenterPoint |
|---|---|---|
| Customer charge | $3.42 | $4.39 |
| Delivery charge (per kWh) | 4.18¢ | 4.62¢ |
| 1,000 kWh monthly total | $45.62 | $50.59 |
On a 1,000 kWh home, CenterPoint customers pay about $60 more per year in delivery charges than Oncor customers, before you factor in the generation rate.
The customer charge is flat: you pay it every month no matter how little you use. The delivery charge scales with usage. The more kilowatt-hours you pull through the meter, the more you owe. So a low-usage apartment feels the customer charge most, while a 3,000-square-foot house with summer AC feels the per-kWh rate most.
Why you can't shop your TDU away
Here's the part that trips people up: switching providers does nothing to your delivery charge. The TDU fee is set by tariff and passed through identically by every retail provider in that territory. Whether you sign with a big national brand or a small Texas startup, the Oncor or CenterPoint line on your bill is the same.
That means you're only ever shopping the generation rate, the price your REP charges for the actual electricity, plus its margin. The wires cost is fixed by your zip code.
Why this matters when you shop
Because the TDU fee is bundled into every plan, the "average" Texas rate you see quoted isn't really apples-to-apples across markets. A 10¢ plan in Dallas is not the same bill as a 10¢ plan in Houston.
This is also why the Electricity Facts Label (EFL) matters more than the headline rate. Every plan's EFL shows the average price per kWh at 500, 1,000, and 2,000 kWh, and those numbers already fold in your TDU's delivery charges. Compare EFLs at the usage level that matches your home, not the marketing number on the ad.
Common mistakes shoppers make
- Chasing the lowest advertised rate. A teaser rate often hides a bill credit that only triggers at exactly 1,000 kWh. Use under that, and the all-in cost can jump well past a plainer plan.
- Assuming Houston and Dallas prices are comparable. They share a wholesale market, but different TDU tariffs mean the same generation rate lands as a different bill.
- Confusing the TDU with the provider. Oncor and CenterPoint don't take your enrollment, send your bill, or answer rate questions. Your REP does. Call your provider, not the utility, when something looks off.
- Worrying that switching disrupts service. It doesn't. Same poles, same wires, same meter. Only the company that bills you changes.
What about the other Texas TDUs?
Oncor and CenterPoint are the two largest, but they aren't the only ones. AEP Texas runs two zones: Central (around Corpus Christi and the Rio Grande Valley) and North (around Abilene). TNMP covers pockets near Houston, the Gulf Coast, and West Texas. LP&L serves Lubbock, the newest entrant to the competitive market. Each files its own tariff, so each carries its own delivery charge.
Quick FAQ
Can I lower my TDU charge? No. It's regulated and identical across providers in your area. Your only lever is the generation rate you lock in.
Does a fixed-rate plan freeze my delivery charge too? A fixed-rate plan locks the energy rate for your term. TDU charges can still change when the utility files a new tariff, and most contracts allow that pass-through.
Who do I call about an outage? Your TDU. They own the wires. For billing or plan questions, call your retail provider.
Our comparison tool shows the all-in rate including your specific TDU fee, so you can compare honestly.