How to Switch Electricity Providers in Texas (and What Happens When Your Contract Ends)

If you live in a deregulated part of Texas, you can change who sells you electricity about as easily as you change your phone plan. The lights don't go out. Nobody comes to your house. The switch usually finishes within a few business days, and the state says nobody can charge you a fee for making it.

Here's how to switch electricity providers in Texas, step by step, including the part most guides skip: what actually happens when your contract ends, why the "no action" outcome is the expensive one, and the two-week window where you can walk away from a fixed-rate plan without paying a termination fee.

Who can switch electricity providers in Texas

Most Texans live in an area where you pick your own retail electric provider (REP). If your wires company is Oncor, CenterPoint, AEP Texas, or Texas-New Mexico Power, you're in. That covers Houston, Dallas, Fort Worth, Arlington, Corpus Christi, and most of the state.

If you're served by a city-owned utility like Austin Energy or CPS Energy in San Antonio, or by an electric co-op, you don't have a choice of provider. There's nothing to switch. The Texas deregulation explainer covers why the map looks the way it does.

One more thing to get straight before we start. Your REP is the company that bills you. Your transmission and distribution utility (TDU) is the company that owns the poles, wires, and meter. When you switch, only the REP changes. Same wires, same meter, same outage crew.

Step 1: Find your contract end date and your termination fee

Pull up your last bill or your Terms of Service. You're looking for two things: the date your current plan ends, and the early termination fee (ETF) if you leave before that date.

If you're on a fixed-rate plan, your provider has to tell you the end date is coming. Under PUCT rule §25.475(e)(1), the REP must send at least three written notices during the last third of your contract. On a 12-month plan, the first can arrive up to three months before the end. The final one has to land at least 30 days before expiration. By rule, the envelope or email subject line says "Contract Expiration Notice. See Enclosed." That's the one people throw away because it looks like junk mail.

Didn't get any notices and you're near the end? §25.475(e)(1)(C) says the REP has to keep serving you at your fixed contract terms until it sends them. Don't let a provider roll you onto a variable rate it never warned you about.

Step 2: Know your usage before you shop

Every plan's advertised price is quoted at a specific usage level, usually 1,000 kWh a month. Your house isn't average. A 1,400-square-foot home in Houston with an older AC can pull 1,800 kWh in August and 600 in October, and some plans get noticeably more expensive at the low end because of a base charge or a usage credit you stop qualifying for.

Grab your last 12 months of kWh from your bills, or log in to Smart Meter Texas and pull the history. Write down your high month, your low month, and your average. You'll compare every plan against those three numbers, not against the number on the ad.

Step 3: Compare plans by ZIP and read the EFL

Enter your ZIP code, get the list of plans available at your address, then open the Electricity Facts Label on the ones that look good. The EFL is the state-required document that shows the real price at 500, 1,000, and 2,000 kWh, whether TDU delivery charges are included, the contract length, and the exact ETF. If you've never read one closely, here's how to read a Texas EFL line by line.

Things to check on the EFL:

• Price at the usage level closest to *your* average, not just 1,000 kWh

• Whether the rate is fixed or variable, and for how many months

• The early termination fee, and whether it's a flat amount or per month remaining

• Any monthly base charge or minimum-usage fee

• Bill credits that only kick in above a usage threshold

Term length matters more than people think. A 12-month plan signed in September runs out next September, right when summer demand is fading and you can shop calmly. A 6-month plan puts you back in the market in March. Both are fine. Just don't let a contract expire in the middle of July if you can avoid it.

When you compare Texas electricity plans by ZIP code on Energy Outlet, we rank plans by price and terms, not by who pays us. We do earn a commission when you enroll through the site. It never changes the order you see.

Step 4: Enroll and pick your switch date

Enrolling online takes a few minutes. You'll need your service address, your ESID (the long number on your bill that identifies your meter), and a start date.

The start date is where a little planning pays off. Under §25.474(k), your new REP submits either a standard switch, which processes on the next date your wires company's schedule allows, or a self-selected switch, where you name the day. If your current contract ends on October 14, ask for a start date on or just after it. If you're already out of contract, take the first available date.

There's a fee question here, and the answer is no. §25.474(n) says a REP can't charge you a fee to switch to it, select it, or enroll with it. ERCOT doesn't charge you either. The only exception is an out-of-cycle meter read for a home without a smart meter, which in 2026 is rare.

Step 5: Don't call your old provider

This one trips up a lot of people. You do not cancel service with your current REP. Your new provider files the switch with ERCOT, ERCOT tells your old provider, and your old provider sends a final bill. That's the whole handoff.

If you call your old company and cancel, you can end up with a disconnect order instead of a clean switch. Let the process work.

The Power to Choose FAQ, run by the Public Utility Commission, puts it plainly: you don't need to contact your current electric company, and the switch happens automatically within seven business days.

Step 6: Watch for the confirmation, and use your three days if you need them

After you sign up, the new REP sends a Terms of Service document. From the day you receive it, you have three federal business days to cancel with no penalty or fee. That's your right of rescission under §25.474(j). It only applies to switches, not to move-ins at a new address.

Then comes the final bill from the old provider. If you paid a deposit, it should come back to you on that bill, or be applied against what you owe. Deposit refund rules are their own topic, but the short version is that the money is yours once the account closes in good standing.

What happens when your contract ends and you do nothing

This is the part that costs Texans real money every year, so it gets its own section.

If you let a fixed-rate contract expire without picking a new plan, §25.475(e)(2)(A) says your REP moves you to a default renewal product. It's month-to-month, you can leave any time with no fee, and the price *may vary between billing cycles*. People call this the holdover rate.

Read that last part again. The price can change every month. Providers aren't required to make it competitive, and in practice the holdover rate is often well above what the same company charges a new customer signing a fixed term. You won't get a warning when it goes up. You'll just see it on the bill.

There is one good thing about the holdover rate: you can leave it tomorrow. No ETF, no waiting. If you've been on one for a while, this is the cheapest fix in the whole guide. Compare plans at your ZIP, pick a fixed rate, and take the first available switch date.

The 14-day window where the termination fee disappears

Here's the rule most people never hear about. If your contract has a calendar end date, §25.475(e)(2)(C)(ii) requires the expiration notice to state, in bold, that no termination penalty applies to residential customers during the 14 days before that date. If your contract ends "on or after" a meter read instead of a fixed date, the same 14-day protection applies counting back from the "on or after" date.

So you don't have to time the switch to the exact day. Line up your new plan a couple of weeks early, set the start date inside that final two-week window, and the ETF is off the table.

Moving is the other clean exit. Under §25.475(c)(2)(C), a contract is tied to a service address. If you move, give your provider a forwarding address (and proof you've left, if they ask), and they can't charge an ETF. You can then shop fresh at the new place.

Switching mid-contract: when it's worth paying the fee

Sometimes the math favors leaving early. If you're locked into a rate signed during a price spike and the ETF is a flat amount, run the numbers: your monthly usage times the difference in price, times the months remaining, against the fee. If the gap is big and the months are many, the fee can be the cheaper path. If the ETF is per month remaining, it's usually not.

Either way, the ETF is the *only* cost of switching early. Your new provider can't add a fee, and neither can ERCOT.

Why fall is a decent time to be doing this

A lot of Texas contracts end in September and October because that's when people signed them the year before. It's not bad timing. Summer demand on the ERCOT grid peaks in July and August, and the fall shoulder months are historically when providers post their calmer rate boards. The spring shopping guide explains the seasonal pattern; the same logic runs in the other direction after Labor Day.

If your notice just arrived, you're shopping at a good moment. Don't waste it on the holdover rate.

Common questions

How long does it take to switch electricity providers in Texas?

Power to Choose says the switch completes automatically within seven business days. With a smart meter, it's often faster. You can also request a specific date when you enroll.

Does it cost anything to switch electricity providers?

No. PUCT rule §25.474(n) bars your new provider from charging a switching or enrollment fee. The only cost is an early termination fee from your *old* contract if you leave before it ends, and even that goes away in the final 14 days or if you're moving.

Will my power go out when I switch?

No. Your wires company (Oncor, CenterPoint, AEP Texas, or TNMP) keeps running the lines and the meter. Only the company that bills you changes.

Can I switch electricity providers before my contract ends?

Yes. You'll owe the ETF listed on your Electricity Facts Label unless you're inside the 14-day window before expiration or you're moving to a new address.

What is a holdover rate?

It's the month-to-month default renewal product your REP puts you on if your contract expires and you don't choose a new plan. It can change price every billing cycle and is usually higher than a fixed rate. You can leave it any time with no fee.

Should I switch if I'm already on a month-to-month plan?

Almost always worth checking. Month-to-month and holdover rates carry no termination fee, so the only thing standing between you and a lower fixed rate is a few minutes of comparison. Month-to-month plans have their place, but a holdover rate you never chose isn't the same thing.

Where to start

Find your contract end date. Pull your usage. Then compare electricity plans by ZIP code, open the EFLs, and set a start date inside your 14-day window. The whole thing takes less time than reading this post did.