The trick hiding in plain sight
Open any Texas electricity marketing page and you’ll see a single headline rate: 9.8¢/kWh, 10.2¢/kWh, whatever. That number is engineered. It’s the blended rate you pay if — and only if — you use exactly 1,000 kWh in a given month.
Use 500 kWh? Your effective rate jumps to 13.6¢. Use 2,000 kWh? It might drop to 8.9¢. Providers are required to disclose this on the Electricity Facts Label (EFL), but almost nobody reads them.
How the inflation works
Three components drive the mismatch:
- Base charges. A flat $9.95/month fee that barely moves the needle at 2,000 kWh but triples your effective rate at 500 kWh.
- Minimum-usage penalties. Many plans charge an extra $9.99 if you use under 1,000 kWh. That penalty alone adds 2¢/kWh to a small user’s bill.
- Tiered rates. A plan might charge 12¢ for the first 500 kWh, then 8¢ after. The advertised “average” is just a weighted guess.
Run the real math in 60 seconds
Pull up your last 12 months of usage and calculate your average. Then for each plan you’re considering:
- Find the EFL (every provider is required to link to it).
- Read the three-tier disclosure: 500 / 1,000 / 2,000 kWh.
- Pick the tier closest to your actual usage.
- Use that rate to estimate your bill — not the marketing number.
Better: use our comparison tool, which does this automatically based on the usage number you enter.