How to Read an EFL in Texas: Line by Line

A Dallas renter signs up for a plan advertised at 9.9 cents per kilowatt-hour. Three months later her bill is closer to 14 cents. The plan was not a scam. The rate was right there on the Electricity Facts Label the whole time, buried in a pricing table she scrolled past in thirty seconds.

Texas runs a fully competitive electricity market. Retail Electric Providers in Texas compete for your business, which is good for consumers, but it also means plans come with layered pricing structures that only one document fully explains: the Electricity Facts Label, or EFL. The Public Utility Commission of Texas requires every Retail Electric Provider (REP) to publish one for every plan, in a standardized format, before you sign. It is the authority on what you will pay. Learning to read it takes about two minutes, and it is worth every second.

The EFL is a one- to two-page disclosure mandated by the Public Utility Commission of Texas (PUCT). Think of it as a nutrition label for your electricity plan. Every REP must file its EFLs with the PUCT and post them on its website. You can also find them on PowerToChoose.org, the PUCT's official shopping portal, by clicking any plan's name.

The EFL does not replace the Terms of Service, which covers contract length, cancellation fees, and auto-renewal terms. But it is the single document that tells you the math behind your monthly bill. If anything a salesperson or a website banner says contradicts the EFL, trust the EFL.

The first section you will see after the plan name and contract term is a table with three usage levels: 500 kWh, 1,000 kWh, and 2,000 kWh. Next to each is an average price per kWh. These are the numbers most people stop at, but they are not the full story.

The PUCT requires these three benchmarks so you can compare plans on a level playing field. The 1,000 kWh column is most often cited because it is close to the statewide average monthly usage for a Texas home. As of July 2026, the lowest all-in advertised rate for Oncor-territory plans at 1,000 kWh is roughly 7.2 cents per kWh, and the median across roughly 132 active plans is about 16.5 cents per kWh. That spread is enormous, which is exactly why the EFL exists.

The catch: those averages are calculated by dividing your total estimated bill by your kWh usage. They fold in every fee and credit. A plan with a spectacular 500 kWh rate can look far worse at 2,000 kWh, or vice versa. Your real cost depends on where your actual usage falls, and the EFL is the only document that shows you that arithmetic clearly.

Below the summary table, the EFL breaks your bill into components. Two categories account for nearly everything.

Energy charge: This is what the REP earns. It may be a flat per-kWh rate, a tiered rate that changes at usage thresholds, or a flat monthly fee combined with a variable per-kWh rate. Read this line carefully. A plan that looks flat-rate in ads sometimes hides a price step at 1,000 kWh or 2,000 kWh inside the EFL.

TDU delivery charges: These are set by your Transmission and Distribution Utility, not the REP. In the Dallas area that is Oncor. In Houston it is CenterPoint Energy. In parts of West Texas and the Panhandle it is AEP Texas. In smaller markets it may be Texas-New Mexico Power (TNMP). Every plan in a given TDU territory carries the same pass-through delivery charges, so they do not distinguish one REP from another. What they do is add a meaningful fixed and per-kWh amount to every bill regardless of which plan you pick. That is why the all-in average price from the EFL table matters more than any rate a banner ad highlights.

Rates also differ by TDU territory, so a plan's pricing in an Oncor zip code will look different from the same plan's pricing in a CenterPoint zip code. Always use an EFL generated for your specific service address.

A bill credit is a dollar amount the REP subtracts from your monthly bill when you hit a certain usage threshold. It sounds like a reward. In practice it is a pricing mechanism, and it is one of the most commonly misunderstood lines on an EFL.

Here is how it works in the wild: a plan might advertise a rate of 8.5 cents per kWh but include a $35 bill credit that only applies if you use at least 1,000 kWh in the billing period. At 1,000 kWh that credit brings your effective all-in rate down substantially. At 900 kWh you miss the credit entirely and your actual per-kWh cost jumps. The EFL will show you this clearly in the average price columns: the 1,000 kWh column benefits from the credit, but the 500 kWh column does not.

Before signing a bill-credit plan, ask yourself whether your household reliably uses enough power to hit the threshold every month. In a mild Texas spring or fall, a small home or apartment can easily fall short. If your usage fluctuates, a plan without a bill credit but with a lower base energy charge may be more predictable.

Near the bottom of the pricing detail section, look for language about a minimum usage fee or a minimum bill amount. Some REPs charge an extra flat fee, often listed as something like a monthly base charge, when your consumption falls below a floor, commonly 500 kWh or 1,000 kWh.

This fee is the mirror image of the bill credit. Instead of rewarding high usage, it penalizes low usage. For a one-bedroom apartment or a home where the occupants travel frequently, this line can quietly add a fixed cost that pushes the real per-kWh rate well above what the average price table implies at higher usage levels.

The EFL will show its effect in the 500 kWh column. If the average price at 500 kWh is dramatically higher than at 1,000 kWh on the same plan, a minimum usage fee or a high base charge is almost certainly the cause. That divergence is a clear signal to check whether your typical monthly usage will regularly clear the threshold.

The EFL also states the contract length (month-to-month, 6-month, 12-month, 24-month, and so on) and the early termination fee (ETF). ETFs are typically a flat dollar amount per remaining month or a single fixed fee. Both methods are legal under PUCT rules.

One line that many shoppers miss: the renewal notice period. Texas REPs must give you advance notice before a fixed-rate contract converts to a new term or a month-to-month rate, but the specific notice window is disclosed in the Terms of Service, not the EFL. Check both documents. Setting a calendar reminder a month before your contract ends costs nothing and gives you time to shop again on PowerToChoose.org or compare current offers at ElectricRates.org's Texas page without pressure.

Every EFL includes a renewable content disclosure, expressed as a percentage of the electricity product that comes from renewable sources such as wind or solar. Texas leads the country in wind generation, so many plans carry a meaningful renewable percentage.

Be aware that a high renewable percentage does not automatically mean the electricity physically flowing to your home is green. It means the REP has purchased Renewable Energy Certificates (RECs) equivalent to that share of your consumption. If environmental impact matters to you, look for plans that disclose 100 percent renewable sourcing and specify the REC source. The percentage on the EFL is the legally required disclosure, and it is standardized, making it easy to compare across plans.

Reading one EFL is a skill. Comparing three or four at once is where you save real money. Here is a practical sequence.

First, estimate your typical monthly usage. Your last 12 months of bills or your smart meter data (available through your TDU's portal) will show you a reliable average and a low-month floor. Second, look at the EFL column that matches your average usage, not the column with the best advertised rate. Third, check whether a bill credit or minimum usage fee creates a cliff at a specific threshold. Fourth, note the contract length and ETF so you know your exit cost if circumstances change.

Rates shift constantly. As of July 2026 the spread between the lowest and median all-in rates in the Dallas area at 1,000 kWh is more than nine cents per kWh. On a 1,000 kWh month that gap is over ninety dollars. Visit ElectricRates.org's Texas electricity page for live rate comparisons sorted by your zip code, or go directly to PowerToChoose.org to pull EFLs for any plan you are considering. Either way, open the EFL before you click enroll.