Last updated: June 28, 2025

In Texas, there are three different roles a company can play:

• Generators are companies that produce electricity.
• Transmission and distribution service providers (TDSPs) are the companies that maintain wires and the poles that deliver energy.
• Retail electric providers (REPs) purchase electricity from the Generators, which they then resell to consumers and provide customer service and billing.

Remember, energy deregulation only applies to REPs. It’s not possible for residents to choose the TDSP, but they do have control over which REP they purchase energy from.

Map of Deregulated Counties in Texas

Highlighted counties are either partially or fully deregulated.  Counties in gray are regulated.

Out of 254 counties in the state of Texas, 173 of them are at lease partially  deregulated.  Homes and businesses within those counties are able to switch to an energy plan offered by an alternative retail energy providers (REPs).

Major Deregulated Cities

Approximately 80-85% of homes and businesses in Texas reside within a “deregulated” energy market, meaning REPs operate within those markets and energy consumers (homes and businesses) there are able to shop for electricity rates and plans.

Commercial Electricity Rates

With several of the world’s major oil companies based or headquartered in the state of Texas, it is no surprise that oil and gas is a thriving industry. However, the state has many businesses in many industries that require electricity in order to run their day-to-day operations including:

• Agriculture
• Banking & Finance
• Aeronautics
• Small Business – Manufacturing and Non-Manufacturing
• Large Business – Manufacturing and Non-Manufacturing
• Tourism
• Computer Technology
• Government
• Entertainment

The amount of energy consumed is highly dependent on the number of machines operated by the company or business during the work day (and in some cases, after the work day has ended). Overall, there are 2 major sectors for energy consumption in Texas related to businesses. These sectors include:

• Commercial – Companies that fall within this sector uses over 12% of the state’s energy.
• Industrial – This sector consumes over 49% of the state’s energy.

Transportation is a third sector, and it consumes slightly above 24% of the state’s total energy usage.

Texas’ Energy Market

While energy deregulation created a shift in how electricity reaches its consumers, there are many other interesting facts about the Texan energy market:

• $1,801 is the average annual cost of electricity cost per household.
• It is the largest producer of lignite coal in the United States
• Petroleum refineries in this state have a capacity of 5.1 million barrels per day, which makes up 29% of the nations refining limit.
• In 2014, Texas generated 39 million megawatt hours from wind-powered energy generation.
• As of 2016, electricity prices in Texas have fallen for two consecutive years.

Power to Choose

Power to Choose is a program run by the Public Utility Commission of Texas. Its goal is to protect residents of the state from unfair energy costs and unregulated REPs, as well as develop a strong infrastructure. The program provides an easy to use, online tool that give residents of the state the opportunity to compare rates, plans and other energy options.  Keep in mind though, you really need to read the fine print if you decide to use Power to Choose (or any other service, for that matter).

Residents and businesses in the state of Texas must remember that utilities are responsible for all energy related emergencies. REPs take care of the electricity supply, but they do not manage wires, poles, or outages.