Texas has the most competitive commercial electricity market in the United States. With 100+ providers, deregulated pricing, and rates 35% below the national average, Texas businesses have more power to control energy costs than anywhere else in the country. Compare real-time business electricity rates, explore pricing by city and utility territory, and find the best plan for your company.
Key Takeaways
- 9.12¢/kWh average all-in commercial rate — 35% below national average
- 100+ providers compete for business customers in deregulated areas
- 6.02¢/kWh lowest available energy-only rate (NRG, 6-month contract)
- 85% of Texas has a deregulated electricity market
- Oncor territory (Dallas-Fort Worth) has the lowest all-in commercial rates
- 6 to 60 months fixed-rate contracts available for budget certainty
9.12¢
TX Commercial Avg
14.12¢
National Avg
-35%
TX Savings
100+
Active Providers
Commercial Electricity Rates Across Texas
Average all-in business rates by metro area — February 2026
Rate Categories
Quick Stats
TX Commercial Avg
9.12¢/kWh
Cheapest Metro
San Antonio — 8.48¢
Most Expensive
El Paso — 10.12¢
National Avg
14.12¢/kWh
Avg Commercial Rate
Texas Business Average
9.12¢/kWh
35% below national average
$5,000+ annual savings vs. avg U.S. business
National Business Average
14.12¢/kWh
5.00¢ more per kWh
Higher fuel costs, less competition
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Current Texas Business Electricity Rates
These are real energy-only rates from competitive Retail Electric Providers (REPs) in the deregulated Texas market. Your total bill will also include TDU delivery charges (typically 3–5¢/kWh) from your local utility. For a complete, real-time list tailored to your business, enter your zip code above.
Top Commercial Plans — February 2026
Avg energy-only rate: 6.80¢/kWh
| Provider | Contract Length | Rate (¢/kWh) |
|---|---|---|
| NRG | 6 months | 6.02 |
| Gexa Energy | 6 months | 6.24 |
| Hudson Energy | 6 months | 6.50 |
| Pulse Power | 18 months | 6.57 |
| Direct Energy | 6 months | 6.57 |
| APG&E | 6 months | 6.59 |
| Freepoint Energy Solutions | 6 months | 6.78 |
| NRG | 12 months | 6.92 |
| NRG | 24 months | 6.95 |
| NRG | 36 months | 6.97 |
| NRG | 60 months | 6.95 |
| APG&E | 18 months | 7.00 |
| IronHorse Power Services | 6 months | 7.06 |
| Hudson Energy | 18 months | 7.10 |
| Gexa Energy | 18 months | 7.18 |
Rates shown are energy-only charges. Total cost includes TDU delivery fees, which vary by utility territory. Enter your zip code for all-in pricing specific to your location.
Need a Custom Quote?
Businesses with high or complex usage patterns qualify for custom pricing that's often lower than published rates. Call 1-800-974-3020 or enter your zip code to get a personalized commercial quote.
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Business Rates by TDU Service Area
Your TDU (Transmission and Distribution Utility) determines the delivery charges on your bill, which typically represent 40–50% of total costs. Delivery charges are regulated and the same regardless of which REP you choose — only the energy portion is competitive.
All Texas TDU Service Areas
TX avg all-in: 9.12¢/kWh
| TDU | Service Area | Delivery (¢/kWh) | Avg All-In Rate | vs 2025 |
|---|---|---|---|---|
| Oncor | Dallas-Fort Worth, Waco, Midland, Tyler | 4.41 | 8.85 | +3.8% |
| AEP Texas North | Abilene, San Angelo | 4.40 | 8.92 | +3.9% |
| AEP Texas Central | Corpus Christi, Victoria, McAllen | 4.56 | 9.56 | +4.1% |
| CenterPoint Energy | Houston, Galveston, Coastal TX | 4.73 | 9.73 | +4.5% |
| TNMP (Texas-New Mexico Power) | Various regions statewide | 5.00 | 10.41 | +5.3% |
| Texas Average | All deregulated areas | 4.55 | 9.12 | +4.2% |
Delivery charges are approximate averages and adjusted by the PUCT on March 1 and September 1 each year. Actual charges vary by usage tier and rate class.
03
Business Electricity Rates by Texas City
Commercial electricity rates vary significantly by metro area based on your TDU territory and whether your city is in the deregulated ERCOT market. Businesses in deregulated areas can shop for competitive rates; those in municipal utility territories cannot.
| City | TDU / Utility | Avg Rate (¢/kWh) | Deregulated? | vs 2025 |
|---|---|---|---|---|
| Dallas | Oncor | 8.85 | Yes | +3.8% |
| Midland-Odessa | Oncor | 8.79 | Yes | +3.6% |
| Lubbock | Oncor | 9.05 | Yes | +3.7% |
| Fort Worth | Oncor | 8.91 | Yes | +3.9% |
| Waco | Oncor | 8.93 | Yes | +3.8% |
| Tyler | Oncor | 9.01 | Yes | +3.9% |
| San Antonio | CPS Energy | 8.48 | No (Municipal) | +2.8% |
| Houston | CenterPoint | 9.73 | Yes | +4.5% |
| Austin | Austin Energy | 9.32 | No (Municipal) | +4.1% |
| Corpus Christi | AEP Central | 9.56 | Yes | +4.1% |
| McAllen | AEP Central | 9.78 | Yes | +4.3% |
| Beaumont | Entergy Texas | 9.88 | No (Regulated) | +4.0% |
| El Paso | El Paso Electric | 10.12 | No (Regulated) | +3.5% |
| Amarillo | Xcel Energy / SPS | 9.45 | No (Regulated) | +3.2% |
| Texas Average | All areas | 9.12 | — | +4.2% |
04
Texas Commercial Rate History
Texas commercial electricity rates have risen steadily since 2020, driven by Winter Storm Uri recovery costs (2022), rising natural gas prices from LNG exports, ERCOT reliability upgrades, and increased data center demand. Despite increases, Texas remains well below the national average every year.
2025 (Current)
9.12¢/kWh
+7.2% vs 2024
National avg: 13.46¢ — Texas saves 32%
Texas Commercial
Other Years
05
Types of Commercial Electricity Plans in Texas
While fixed-rate plans are the most popular choice for Texas businesses, the deregulated market offers several plan structures to match different operational needs and risk tolerances.
Fixed-Rate Plans
Lock in a consistent ¢/kWh rate for 6 to 60+ months. Shields your business from market price volatility and ensures predictable monthly budgeting.
Best for: Most businesses seeking stability
Block & Index Plans
Fix a price for a predetermined "block" of expected usage. Any excess consumption is priced at the floating wholesale market (index) rate.
Best for: Large enterprises with predictable baseloads
Variable-Rate Plans
Rates adjust monthly based on wholesale market changes. May yield savings during low-demand periods but carries significant risk during price surges.
Best for: Risk-tolerant businesses with flexible operations
Time-of-Use Plans
Rates vary between peak and off-peak hours. Rewards businesses that shift high-energy operations (manufacturing, EV charging) to nights or weekends.
Best for: Businesses with flexible operating schedules
06
Frequently Asked Questions
What is the average commercial electricity rate in Texas?
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The average all-in commercial electricity rate in Texas is 9.12¢/kWh as of February 2026, which is 35% below the national commercial average of 14.12¢/kWh. Energy-only rates from competitive retail providers currently average 6.80¢/kWh before TDU delivery charges. Your total cost depends on your TDU territory, usage volume, contract length, and load profile.
Why are Texas business electricity rates lower than the national average?
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Texas benefits from several factors: abundant, low-cost natural gas (the state produces ~30% of U.S. supply), a deregulated market with 100+ competing providers driving prices down, massive wind and solar capacity reducing wholesale energy costs, no state income tax subsidies embedded in utility rates, and a relatively modern grid with lower legacy infrastructure costs. Competition alone drives commercial rates 15–30% lower than regulated markets.
What areas of Texas have deregulated electricity?
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Approximately 85% of Texas has a deregulated electricity market, covering the areas served by ERCOT and the five major TDUs: Oncor (Dallas-Fort Worth, Waco, Tyler, Midland), CenterPoint (Houston, Galveston), AEP Texas Central (Corpus Christi, McAllen), AEP Texas North (Abilene, San Angelo), and TNMP (various regions). Notable exceptions include San Antonio (CPS Energy), Austin (Austin Energy), El Paso (El Paso Electric), Beaumont (Entergy Texas), and Amarillo (Xcel Energy).
What's the difference between a TDU and a REP?
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Your TDU (Transmission and Distribution Utility) — such as Oncor, CenterPoint, or AEP Texas — owns and maintains the physical grid infrastructure: poles, wires, transformers, and meters. They deliver electricity to your business regardless of which provider you choose. Your REP (Retail Electric Provider) is the company you buy electricity from — they set your energy rate, send your bill, and handle customer service. You choose your REP; your TDU is determined by your physical location.
What types of commercial electricity plans are available?
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Texas businesses can choose from four main plan types: Fixed-rate plans lock in a consistent ¢/kWh rate for 6–60 months. Block-and-index plans fix a price for a block of expected usage with excess at market rates. Variable-rate plans adjust monthly based on wholesale prices. Time-of-use plans offer lower rates during off-peak hours, rewarding businesses that shift operations to evenings or weekends.
What are demand charges on a commercial electricity bill?
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Demand charges are based on your peak demand — the highest amount of electricity your business consumes at any single point during a billing cycle, measured in kilowatts (kW) over 15- or 30-minute intervals. Your TDU charges this fee to ensure the grid can meet your maximum power needs at any moment. Demand charges can represent 30–70% of a commercial electricity bill, making peak management a critical cost-control strategy for businesses.
How does load factor affect my business electricity rate?
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Load factor is a percentage that measures how consistently your business uses electricity (total consumption ÷ peak demand × hours in period). A high load factor (steady, predictable usage — like data centers or 24/7 manufacturing) is more efficient and attractive to providers, often resulting in a lower per-kWh rate. Businesses with sporadic, high-peak usage (a low load factor — like seasonal retail or event venues) typically see higher rates because they require more grid capacity relative to their total consumption.
What information do I need to get a commercial electricity quote?
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To get an accurate custom quote, you'll typically need: 12 months of electricity usage history from your bills (monthly kWh consumption and peak demand), your ESI ID (Electric Service Identifier — a unique 17- or 22-digit number found on your bill), your business address and meter information, and your current contract expiration date. Providers use this data to calculate a rate tailored to your specific consumption profile.
How do I switch my business electricity provider?
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Switching is straightforward and seamless. Once you've compared plans and chosen a new provider, you sign a new contract. The new REP handles the entire switch with your TDU — no site visit, no new equipment, and no power interruption. The process typically takes 1–2 billing cycles. The only change you'll notice is a new bill from your new provider. Your TDU (Oncor, CenterPoint, etc.) continues delivering power without interruption.
What happens when my commercial electricity contract expires?
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Your provider will notify you before your contract ends. If you take no action, they will move your account to a variable "holdover" or "month-to-month" rate, which is almost always significantly higher than your fixed contract rate — sometimes 2–3x higher. It's critical to start shopping for a new plan 60–90 days before your current contract expires to ensure uninterrupted savings and avoid costly rollover rates.
What is an Early Termination Fee (ETF) on a commercial contract?
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An ETF is a penalty charged if you break your electricity contract before its end date. Unlike residential ETFs (often a flat $150–$200 fee), commercial ETFs are calculated based on the remaining contract term, usage volume, and current market conditions. They can be very substantial — sometimes tens of thousands of dollars for large accounts. Always review the ETF terms carefully before signing any commercial electricity contract.
Can my Texas business get 100% renewable energy?
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Yes. Texas is the #1 wind energy producer in the U.S. and a top-five solar state. Many REPs offer competitive 100% renewable commercial plans, allowing your business to meet ESG and sustainability goals with little to no price premium over conventional energy. Options include wind-sourced fixed-rate plans, solar buyback programs, and plans backed by Renewable Energy Certificates (RECs).
Is my business exempt from sales tax on electricity in Texas?
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Possibly. Texas businesses predominantly engaged in manufacturing, processing, or fabrication may qualify for a sales tax exemption on electricity. You must complete a Predominant Use Study and submit a Texas Comptroller exemption certificate (Form 01-339) to your electricity provider. This can reduce your total electricity cost by 6–8%, which adds up quickly for high-usage commercial accounts.
What's the best time of year to lock in a commercial electricity rate?
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The best times to shop are during the "shoulder months" of spring (March–May) and fall (September–November). Energy demand is lower during these mild-weather periods, which leads to more competitive wholesale prices and lower contract rates. Avoid signing new contracts during peak summer months (June–August) when Texas heat drives electricity demand — and prices — to their highest levels.
Which areas of Texas are NOT deregulated?
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Several areas opted out of deregulation or are outside of ERCOT: San Antonio (CPS Energy — municipal), Austin (Austin Energy — municipal), parts of East Texas (Entergy Texas), El Paso (El Paso Electric — not in ERCOT), the Amarillo area (Xcel Energy / Southwestern Public Service — not in ERCOT), and many rural electric cooperatives. Businesses in these areas cannot choose their electricity provider and pay rates set by their utility or cooperative.
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Data Sources & Methodology
About This Data
All-in commercial rates are sourced from the U.S. Energy Information Administration (EIA) Electric Power Monthly and the Public Utility Commission of Texas (PUCT). Provider energy-only rates are sourced from live market data on ElectricChoice.com. TDU delivery charges are based on current approved tariff schedules filed with the PUCT. Year-over-year comparisons use the same month from the prior year. City-level rates are weighted averages based on TDU territory and local rate class data. Last refresh: February 3, 2026.