Electricity 101

Texas Electricity Companies: Understanding Energy Markets

Gexa Energy
April 26, 2023
minutes read
Gexa Energy
Publication Date:
August 25, 2023
Last updated:
March 8, 2024

Before Texas became a competitive energy marketplace, homeowners relied on local utilities for electricity when there was often only one choice in the area. But that all changed in 2002 when Texas deregulated its energy market.

Now, consumers in most parts of Texas can evaluate electricity plans and choose the one that’s right for them. Here at Gexa Energy, we want to simplify the confusion around retail electric providers in Texas and explain their role in how you receive electricity.


Related: Learn more about deregulated energy in Texas

How Texas Electricity Companies Work Together  

There are several stakeholders within Texas’ electricity markets. Essentially, a power generation company sells power to a Retail Electric Provider (REP), such as Gexa Energy. Then, the REP works with each Transmission and Distribution Service Provider (TDSP) to ensure electricity is delivered to customers in the correct service area.  

The information below describes the different types of Texas REPs and how they work together in the electricity market:

  • Power Generation Company (PGC): Power generation companies own and operate facilities that create electricity and send it to the Texas energy grid. These facilities include all types of power plants, such as coal, nuclear, natural gas, and renewable energy. Generators sell electricity to REPS.
  • Retail Electric Provider (REP): A REP sells electricity to residential and commercial customers, offers a variety of plan prices and options, and is responsible for customer service and billing. This is the company you are choosing as your electricity provider. There are more than 40 REPs in Texas, including Gexa Energy.  
  • Transmission and Distribution Service Provider (TDSP): A TDSP owns, maintains, and repairs all the lines, wires, poles, and meters in their service area. The TDSPs in Texas are Centerpoint, Oncor, Texas-New Mexico Power, AEP North, and AEP Central.  

The last piece of the puzzle is you, the customer. You can choose your REP and be provided with electricity services from a TDSP that services your area. All payments and service-related questions should be directed to your REP.  

Learn More: Making your home energy efficient

ERCOT and PUCT: Overseeing Electrical Companies in Texas  

While Texas’ electricity market is deregulated, there are two important organizations that ensure the market is fair and the grid is reliable—the Public Utility Commission of Texas (PUCT) and the Electric Reliability Council of Texas (ERCOT).  

The Public Utility Commission of Texas regulates the state's electric, telecommunication, and water and sewer utilities, implements respective legislation, and provides customer assistance in resolving consumer complaints.  

The Electric Reliability Council of Texas, Inc. is the organization that operates Texas's electrical grid and the Texas Interconnection, which supplies power to more than 25 million Texas customers and represents 90 percent of the state's electric load.  

Types of Texas Energy Plans

Here are the two main categories of electricity plans in Texas:

Fixed-price energy plans

A customer's price per unit of energy is fixed for the life of the contract. Regardless of when you use the power, you pay a fixed price per kilowatt-hour. Plans such as these could safeguard you from price fluctuations caused by demand and weather.

Variable-price energy plans

On a variable rate plan, the cost per kilowatt-hour can change. In times of high demand, like a Texas summer, you may pay more for electricity. You may also have difficulty estimating your household's energy costs if you have a variable-rate plan that runs month-to-month.

Related: Learn how to save on your electric bill

Renewable Energy Plans in Texas

Gexa Energy is a REP serving customers throughout Texas and providing a variety of affordable energy plans, including specialty plans for solar and electric vehicles.  

Gexa Energy provides (Texas) homeowners with 100% renewable plans from environmentally friendly renewable sources.

Solar Power Electricity Plans

Switching to solar energy is a great way to reduce your carbon footprint and declare energy independence. You can reduce your reliability on the electric grid and potentially eliminate your electric bill. Learn more about Gexa Energy's solar energy plans.

Electric Vehicle Home Charging Plans

Gexa Energy is here to help you conveniently charge your electric vehicle, or EV, at home. You can save on EV charging with our electric vehicle plans.  

Switching Retail Electric Providers

If you wish to switch to another provider within the Texas electricity market, you can do so at any time. However, many contracts include early termination fees. Consult your agreement to determine if there is a fee and when you can switch without paying it.

When switching to a Texas REP, you should evaluate your energy consumption to determine your needs. Previous energy bills can give you a good insight into your electricity requirements.

How to Choose the Best REP in Texas  

There are many things to consider when looking for a Texas REP and plan that’s right for you. Here are some things to keep in mind that could save you energy, time, and money.  

  • Renting or moving: If you are planning to move soon or are just renting temporarily, you may choose a shorter plan. But if you’re owning your home long-term, a fixed-rate plan might make more sense.
  • Month-to-month plans: Sometimes, you may want to try a monthly plan before committing to a 24- or 36-month contract.

Need help finding the right plan for you? Contact Gexa here.  

Final Thoughts About Texas Electricity Markets

If you’re ready to switch electric companies in Texas, Gexa has affordable and sustainable solutions for you. Gexa’s energy plans are offered throughout Texas, where electric choice is available, including Houston, Dallas, Fort Worth, and more.

Choose The 100% Green Electricity Plan That's Right For You.
Choose The 100% Green Electricity Plan That's Right For You.
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Gexa Energy purchases renewable energy credits (RECs) from renewable generation resources throughout North America to match 100% of the energy sold under your electric plan. The RECs Gexa purchases represent the renewable attributes of power generated from a variety of renewable energy sources, including, but not limited to, the sun, wind, geothermal, hydroelectric, wave or tidal energy, and biomass or biomass-based waste products, including landfill gas.