How to Read an Electricity Facts Label in Texas

Every electricity plan in Texas comes with a document called an Electricity Facts Label. It’s the closest thing you get to a nutrition label for your electric bill.

The EFL shows three prices at 500, 1,000, and 2,000 kWh per month, along with a disclosure chart covering contract terms and fees. Most shoppers glance at the 1,000 kWh price, pick the lowest number, and move on.

That approach can work. But it can also land you on a plan that costs far more than expected. Bill credit plans, for example, can show 9.6¢/kWh at 1,000 kWh while costing 19.6¢ at lower usage levels.

This guide covers what each part of the EFL means, where the traps are, and how to use it to find a plan that fits your actual usage.

What is an Electricity Facts Label and why does it matter?

An EFL is a standardized disclosure document that every REP in Texas must provide before you enroll in a plan. The PUCT requires it under Substantive Rule §25.475. It must include:

• An average price per kWh at three usage levels: 500, 1,000, and 2,000 kWh per month
• A disclosure chart covering contract terms, fees, cancellation penalties, and renewable energy content
• A unique version number so you can confirm you’re reading the current edition

Texas has 141 active Retail Electric Providers as of February 2026. Many offer dozens of plans each. The EFL is the only comparison format that’s standardized across all of them.

The format fits on one page. That’s both its strength and its limitation. One page gives you enough to narrow your options, but three prices compress a lot of complexity into three numbers.

Each price is a calculated average, not a rate you’ll see on your bill line by line. The EFL divides your estimated total cost (energy charges plus delivery charges plus fees, minus any credits) by the number of kilowatt-hours for that tier. A plan with a 7¢/kWh energy rate and $15 in monthly fixed charges shows a higher per-kWh average at 500 kWh (10¢) than at 2,000 kWh (7.75¢), even though the energy rate doesn’t change.

What do the prices at 500, 1,000, and 2,000 kWh really mean?

The three prices on an EFL aren’t the per-kWh energy rate your REP charges. Each one is an all-in average that bundles together:

• The REP’s energy charge (the per-kWh rate they bill you)
• TDU delivery charges (per-kWh and fixed fees from your local utility)
• Any fixed monthly base charges, divided by the usage level
• Usage credits or bill credits, subtracted if they apply at that tier

Taxes are excluded. State and local sales tax and the state miscellaneous gross receipts tax reimbursement don’t appear in EFL prices (source: PUCT §25.475).

The bundling means the 500 kWh price is almost always the highest of the three. Fixed charges get divided by fewer kilowatt-hours, inflating the per-kWh average. At 2,000 kWh, those same charges spread thin.

A real example from Dallas electricity plans as of February 2026: Bright Nights 4 from Chariot Energy shows 11.0¢ at 500 kWh, 9.6¢ at 1,000 kWh, and 8.9¢ at 2,000 kWh. That 2.1¢/kWh spread between the cheapest and most expensive tier is entirely driven by how fixed charges amortize (source: Watt Owl data, February 2026).

Digital Choice 3 from Rhythm shows 9.6¢ at 500 and 1,000 kWh, and 9.7¢ at 2,000 kWh. That near-flat pricing tells you it’s a straightforward plan with a low base charge and no usage credits. When the spread between tiers is small (less than 1¢/kWh), you’re looking at a simple rate structure. When it’s large (2¢ or more), fixed charges, credits, or tiered rates are pulling the numbers apart.

The statewide average residential rate in Texas was 15.87¢/kWh as of December 2025 (source: EIA Electric Power Monthly). That includes customers on variable-rate holdover plans paying above-market rates. Among the 147 plans we track for ZIP 75201, the average is 14.0¢/kWh at 1,000 kWh, and the cheapest come in well below that.

If the three prices tell very different stories about the same plan, there’s a usage-based credit or a tiered rate structure at work. Figure out why before you sign up.

How do you spot hidden fees and charges on an EFL?

Below the price table, every EFL has a disclosure chart in question-and-answer format. This is where contract details live: plan type (fixed or variable), contract length, termination penalties, other fees, and renewable content.

Base charge. A flat monthly fee that’s already baked into the three EFL prices, but it hits low-usage households hardest. The fewer kilowatt-hours you use, the more each dollar of that fee adds to your per-kWh average.

Early termination fee. Most fixed-rate plans charge $150–$300 if you cancel before the term ends. A 12-month plan at 10¢/kWh might look better than a month-to-month plan at 10.5¢, but the ETF locks you in. If wholesale rates drop mid-contract, you’re stuck paying more or eating the penalty. Our early termination fee calculator can help you figure out whether breaking a contract saves money.

Minimum usage fee. Some plans charge extra when your usage falls below a threshold, often 500 or 1,000 kWh. This is separate from the base charge and shows up on the EFL disclosure chart.

The disclosure chart also tells you whether the plan auto-renews, what percentage of energy comes from renewable sources, and whether it’s prepaid.

Auto-renewal deserves a closer look. Many fixed-rate plans convert to a month-to-month variable rate when the contract expires. If you forget to switch or re-enroll, you could end up paying a higher variable rate. The disclosure chart states whether the plan auto-renews and what rate kicks in after the initial term.

What are TDU delivery charges and how do they show up?

Every EFL price includes TDU delivery charges. These are fees from your local Transmission and Distribution Utility, the company that owns the power lines and delivers electricity to your home. In most of Texas, that’s Oncor (Dallas–Fort Worth), CenterPoint (Houston), or AEP Texas (South and West Texas).

TDU charges include a per-kWh delivery rate and a fixed monthly charge. They’re regulated by the PUCT and identical for every plan in the same service territory. If you’re comparing two plans in Oncor territory, both EFLs include the exact same Oncor delivery fees.

That means the price difference between plans in the same territory comes entirely from the REP’s energy charge and fee structure. The TDU portion cancels out.

One thing the EFL doesn’t show: how much of the average price is TDU delivery versus the REP’s energy charge. For that split, you’d need the plan’s terms of service or the TDU’s published rate schedule. But for comparison purposes, it doesn’t matter. Since TDU charges are identical across plans in the same territory, the plan with the lower EFL price has the lower energy charge.

For a closer look at how delivery fees work and how they’ve changed recently, read our guide to TDU delivery charges.

How do you use an EFL to compare two plans side by side?

Pull up two EFLs for plans in the same utility territory. Then:

1. Check the price at your actual usage level. If you use 1,200 kWh/month, neither the 1,000 nor the 2,000 kWh price is exact. Plans with flat rate structures will look similar across tiers. Plans with credits or tiered rates might look wildly different.
2. Compare the spread between tiers. If Plan A shows 10.0¢ at both 500 and 1,000 kWh, it has a simple rate structure. If Plan B shows 15.0¢ at 500 and 8.0¢ at 1,000, there’s a bill credit or steep tiering involved.
3. Match the contract terms. A 3-month plan at 9.6¢ and a 12-month plan at 10.2¢ aren’t apples to apples. The shorter term gives flexibility. The longer one locks in a rate.
4. Look past the headline rate. Two plans with the same per-kWh rate can have different base charges, ETFs, and minimum usage fees. At low usage, the plan with the lower advertised rate and higher fees might cost more.

The EFL can’t calculate your bill at 850 kWh or 1,300 kWh. For that, plug your ZIP code and real usage into Watt Owl’s electricity plan comparison tool to see estimated monthly costs.

If you’re comparing more than two plans, focus on the ones where the 1,000 kWh price is closest, then use the spread and fees as tiebreakers.

Try It Yourself: Compare Plans Using What You’ve Learned

These plans are sorted by estimated monthly bill for the Dallas area. Adjust the slider to see how rates change at your usage level.

Showing plans for ZIP 75201 (Oncor Electric Delivery service area)

Monthly Usage

kWh

5001,0001,5002,000

100-5,000 kWh range

Provider	Plan	Rate	Est. Bill	Term
	GridPlus 12CHARIOT ENERGY• 100% Green	7.9¢	$79	12mo	Details
	Variable AdvantageSOUTHERN FEDERAL POWER LLC	9.1¢	$90	1mo	Details
	Companion + Perks 5Companion Energy	9.1¢	$91	5mo	Details
	Sustainable Lifestyle - 3AMIGO ENERGY	9.1¢	$91	3mo	Details
	Sustainable Home Bundle - 3TARA ENERGY	9.1¢	$91	3mo	Details

View All 153 PlansHow we calculate rates

What should you watch for with bill credit and TOU plan EFLs?

Two categories of plans need extra scrutiny when you read EFLs.

Bill credit plans offer a credit when your usage hits a threshold like 1,000 or 2,000 kWh. This pulls the EFL price down at that tier while leaving the other tiers high. The Lone Saver 12 and Rhythm Saver 12 both show 9.6¢ at 1,000 kWh but 19.6¢ at 500 kWh (source: Watt Owl data, February 2026). If you consistently hit the threshold, these plans deliver real savings. If your usage varies month to month, you’ll swing between the low rate and the high one. For a full breakdown, see our guide to bill credit plans.

The pattern is easy to spot. If one EFL price drops dramatically compared to the other two, a bill credit at that threshold is almost certainly responsible.

Time-of-use (TOU) plans, including free nights and free weekends deals, charge different rates depending on when you use electricity. The EFL still shows prices at 500, 1,000, and 2,000 kWh, but those assume a specific split between peak and off-peak hours. If your actual usage pattern doesn’t match that assumption, your cost will differ from what the EFL suggests. For details on how these plans work, read our guide to free nights and weekends plans.

Frequently Asked Questions

Find the right plan for your usage

The EFL tells you what a plan costs at three usage levels. The disclosure chart tells you what you’re agreeing to. Together, they give you enough to compare intelligently, as long as you check all three prices, read the fees, and match the plan to how much electricity you actually use.

As of February 2026, there are 147 plans available in Dallas (ZIP 75201) alone, with rates from 9.6¢ to 19.4¢ per kWh at 1,000 kWh (source: Watt Owl data). The gap between the cheapest and most expensive could mean hundreds of dollars a year.

The three EFL prices are a starting point. They can’t account for months when your usage spikes in August or drops in March. Compare plans at your typical monthly usage, not the nearest EFL benchmark.

Actual rates depend on your usage, location, and plan terms. Enter your ZIP code below to compare plans priced at your real usage level.

Watt Owl is a licensed electricity broker in Texas (PUCT License BR260022). We may earn a commission when you enroll through our links. Our recommendations are based on transparent rate calculations, not commission size.