Residential electricity across Texas

Texas is described as a deregulated electricity market, and for most of its population that is true. But the map is patchier than the description suggests, and the differences matter before you shop for anything.

Who has choice and who does not

Retail choice exists in the parts of ERCOT that were opened to competition in 2002. Roughly 85% of Texans live there. The exceptions are consequential:

• Municipal utilities. City-owned utilities such as Austin Energy and CPS Energy in San Antonio kept their monopoly. Residents buy from the city and cannot switch. Lubbock Power & Light is the notable counter-example, having voluntarily entered retail choice.
• Electric cooperatives. Member-owned co-ops could opt in and most did not. Large parts of rural Texas are served this way.
• Areas outside ERCOT. El Paso sits in the Western Interconnection and parts of east Texas sit in the Eastern Interconnection. Neither has ERCOT retail choice.
• Entergy Texas. A regulated utility serving parts of southeast Texas including Conroe and much of Montgomery County north of The Woodlands. No retail choice, which regularly surprises people who have moved from Houston a few miles up I-45.

Your utility is decided by geography

In the deregulated areas you choose your retail provider, never your utility. The transmission and distribution utility for your address owns the wires and the meter and is fixed: CenterPoint Energy in Houston, Oncor across Dallas–Fort Worth and much of north and west Texas, AEP Texas along the coast and in the Rio Grande Valley, and Texas–New Mexico Power in a patchwork of territories including parts of the Gulf Coast.

That matters for your bill because delivery charges are set by utility. Two households in different metros on the identical supply rate will have different bills, because the regulated delivery half differs.

Why geography moves the supply price too

ERCOT settles wholesale prices at locations, not statewide. Congestion on the transmission network means power can be worth meaningfully more in one zone than another at the same moment. Providers price against those zones, so the same company can quote Houston and Dallas differently on the same day for the same usage.

What travels with you and what does not

If you move within deregulated Texas, your contract can usually transfer to the new address and you avoid the early termination fee. If you move into a municipal, co-op or Entergy territory, there is no provider to transfer to — and most contracts waive the termination fee when you can show you are moving out of the competitive market entirely. Ask; it is not always volunteered.