Electricity Facts Label (EFL): How to Read It
The EFL is the "nutrition label" for Texas electricity plans. Learn how to read it and avoid overpaying for power.
Quick Answer: What Is an EFL?
An Electricity Facts Label (EFL) is a standardized document required by Texas law that shows the true cost of an electricity plan. The most important number is the "Average Price per kWh" at your usage level—this includes ALL charges, not just the advertised rate.
Why the EFL Matters
The advertised rate is often not what you'll actually pay
The "9¢/kWh" Trap
A plan advertised at "9¢/kWh" might actually cost you 12-14¢/kWh after delivery fees, base charges, and usage adjustments. The only way to know the true cost is to check the EFL's "Average Price per kWh" at your usage level.
Advertised Rate
Just the energy charge. Doesn't include delivery fees, base charges, or adjustments.
EFL Average Price
True all-in cost at 1000 kWh. This is what you'll actually pay per kWh.
What's on an EFL
Key sections to review before signing up for any Texas electricity plan
Average Price per kWh
Shows total cost at 500, 1000, and 2000 kWh. This is the TRUE price including all recurring charges. Compare this number, not the advertised "energy rate."
Electricity Price
Breaks down energy charge (per kWh rate), base charges (monthly fees), and any usage credits or tiered pricing. Helps you understand the rate structure.
TDU Delivery Charges
Shows utility delivery fees (Oncor, CenterPoint, etc.). These are pass-through charges—same for all providers in your area. Already included in the average price.
Contract Terms
Contract length (month-to-month, 12, 24, 36 months), renewal terms, and what happens when contract expires. Know before you sign.
Early Termination Fee
Fee for canceling before contract ends. Typically $50-$300, sometimes calculated per remaining month. Not included in average price.
Renewable Content
Percentage of electricity from renewable sources. TX average is ~25%. Plans range from 0% to 100% renewable.
5 Common EFL Traps to Avoid
Marketing tricks that make plans look cheaper than they are
1 Low rate at wrong usage level
Low rate at wrong usage level
Example: Plan shows 8.9¢/kWh... but that's at 2000 kWh. At your 1000 kWh usage, it's actually 12.5¢/kWh.
Solution: Always check the price at YOUR typical usage level, not just the lowest advertised rate.
2 Usage credits with minimums
Usage credits with minimums
Example: "$50 bill credit when you use 1000+ kWh!" But if you use 900 kWh, you get nothing and pay more.
Solution: Calculate your cost WITH and WITHOUT the credit. If you might miss the threshold, you might pay more.
3 Tiered pricing gotchas
Tiered pricing gotchas
Example: First 500 kWh at 5¢, next 500 at 15¢, over 1000 at 20¢. Sounds cheap until you do the math.
Solution: Calculate the total cost at your usage, not just the first tier rate.
4 Hidden base charges
Hidden base charges
Example: "Only 7¢/kWh!" But there's a $14.95 monthly base charge making your effective rate 9.5¢ at 1000 kWh.
Solution: The EFL average price includes base charges—compare that number, not the energy rate alone.
5 Short promotional periods
Short promotional periods
Example: 6.9¢/kWh for first 3 months, then 14.9¢/kWh for remaining 9 months of your 12-month contract.
Solution: Read the full term. Calculate your average cost over the entire contract period.
How to Compare Plans Using the EFL
Step-by-step guide to finding your best rate
Know Your Usage
Check your past 3-6 electric bills to find your typical monthly kWh usage. This varies by season—note both your average and your summer peak.
Find the Right Usage Column
On the EFL, look at the "Average Price per kWh" row. Compare the price at the usage level closest to yours (500, 1000, or 2000 kWh).
Check Multiple Usage Levels
If your usage varies seasonally (like most Texas homes), check both your normal usage AND your summer peak. A plan that's cheap at 1000 kWh might be expensive at 1500+ kWh.
Review Contract Terms
Check the contract length and early termination fee. A slightly higher rate with no cancellation fee might be better than a locked-in rate with a $200 penalty.
Calculate Annual Cost
Multiply the average price by your expected annual usage to see total yearly cost. A 1¢/kWh difference = ~$120-$150/year for an average Texas home.
Frequently Asked Questions
Common questions about the Electricity Facts Label
What is an Electricity Facts Label (EFL)?
An Electricity Facts Label (EFL) is a standardized disclosure document required by the Public Utility Commission of Texas (PUCT) for all residential electricity plans. It shows the true all-in cost per kWh at three usage levels (500, 1000, and 2000 kWh), contract terms, fees, and renewable energy content. Think of it like a nutrition label for electricity plans.
Why do EFL prices differ at different usage levels?
EFL prices vary by usage level because many Texas electricity plans include fixed monthly fees, minimum usage charges, or bill credits that only apply at certain usage levels. A plan might show 9¢/kWh at 2000 kWh but cost 14¢/kWh at 500 kWh because the fixed fees are spread across fewer kilowatt-hours. Always compare prices at YOUR typical usage level.
Which EFL usage level should I compare?
Compare the EFL price closest to your actual monthly usage. The average Texas home uses 1,000-1,200 kWh, but this varies significantly: apartments use 500-800 kWh, medium homes 1,000-1,400 kWh, and large homes 1,500-2,500 kWh. Check your past bills to find your typical usage, then compare plans at that level.
What fees are included in the EFL price?
The EFL 'Average Price per kWh' includes ALL charges: energy charges, TDU (Transmission and Distribution Utility) delivery fees, and recurring monthly fees. It's the true total cost divided by kWh used. However, one-time fees like connection charges or early termination fees are listed separately and not included in this average.
What is a TDU charge on my EFL?
TDU (Transmission and Distribution Utility) charges are delivery fees paid to your local utility (Oncor, CenterPoint, AEP, TNMP) for maintaining power lines and delivering electricity to your home. These charges are the same regardless of which retail provider you choose. The EFL includes TDU charges in the average price calculation.
Are there fees NOT shown in the EFL average price?
Yes, one-time fees are listed separately on the EFL but not included in the average price per kWh. These include: early termination fees ($50-$300+), connection/switch fees, disconnection fees, and late payment fees. Always review the 'Other Key Terms and Questions' section of the EFL for these charges.
What does 'renewable energy' mean on the EFL?
The EFL shows what percentage of your electricity comes from renewable sources (wind, solar, hydro). '100% renewable' means all your electricity is matched with renewable energy certificates (RECs). Note that all electricity on the Texas grid is physically mixed—the percentage indicates how much clean energy your purchase supports, not what literally powers your home.
How do I get the EFL before signing up?
By Texas law, providers must give you the EFL before you enroll. On comparison sites and provider websites, look for links labeled 'EFL', 'Facts Label', or 'Plan Details'. You can also request it by phone before signing up. Never enroll without reviewing the EFL first—it's your best protection against surprise charges.
Compare Plans at Your Usage Level
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