Cheapest Electricity Rates Houston Texas | Compare Bills

Search for the cheapest electricity rate in Houston and you will see the same thing everywhere: “plans from about 7 cents.” That number is real on a page. It is not what most Houston homes pay. The cheapest rate is not always the cheapest bill, and your bill is the thing you actually pay.

This guide shows why, in dollars. You will see one example plan, step by step. Then you can check any plan against your own usage. We are a comparison site, not a utility, and we may earn a commission if you switch through a link here. Here is how we make money. Nothing below is a promise of savings, and none of it is legal advice.

Why one “cheapest rate” is never the whole story

Every Texas electricity plan has to publish an Electricity Facts Label, or EFL. It is a short sheet that lists the plan’s price and terms. Texas rules require the EFL to show the average price per kWh at three usage levels: 500, 1,000 and 2,000 kWh. (A kWh, or kilowatt-hour, is how electricity is counted on your bill.)^[1]

Here is the catch. Many ads pick the best of those three numbers and show only that one. A plan can look great at 1,000 kWh and look much worse at 500 or 2,000. The ad is not lying. It is just showing you one point on a line, and your home may sit somewhere else on that line.

So skip the headline. Look for the dollar total at your usage.

The part of your bill that never changes by provider

Your Houston home gets its power through wires owned by CenterPoint Energy. CenterPoint is the transmission and distribution utility, or TDU. It charges a delivery fee on every bill in its area. It does not matter which company you buy your electricity from.

As of October 2026, that delivery fee is about $4.90 a month plus roughly 6.4 to 6.5 cents for every kWh. The per-kWh part went up on September 1, 2026, from 4.9811 cents to 6.4130 cents.^[4] A settlement filed on October 1, 2026 lists 6.5333 cents for meters read on or after September 30, 2026. The state had not issued a final order as of October 14, 2026.^[5] Check CenterPoint’s own rates and tariffs page for the current figure.

At 1,000 kWh, that is about $69 to $70 for delivery alone. Your provider’s energy charge comes on top of it. Many ads quote only the energy part, or an older price. Always read what the EFL includes, and whether delivery is counted.

A worked example: the bill credit cliff

A bill credit is money taken off your bill, but only if your usage lands inside a set range. Many Houston plans use one. Let’s walk through an example plan. The numbers are made up to teach the idea. They are not a real brand or a real offer.

• Energy charge: 13.0 cents per kWh
• Base charge: $5.00 a month
• Bill credit: $80, but only if you use between 1,000 and 1,999 kWh
• Delivery (CenterPoint): $4.90 a month plus 6.5 cents per kWh

Look at the first and second rows. At 900 kWh the bill is $185.40. At 1,000 kWh it is $124.90. The home that used 100 more kWh paid about $60.50 less, because it crossed the line and the $80 credit switched on.

Now look at 1,100 kWh. The bill is $144.40. The credit still applies, so it is a fair bill, but each extra kWh now costs 19.5 cents (13.0 energy plus 6.5 delivery).

There is a cliff on the top side too. At 1,999 kWh this plan costs about $319.71. At 2,000 kWh the credit is gone and the bill is $399.90. One kWh more costs about $80. Credit ranges and amounts differ from plan to plan, so read the real EFL for the real numbers.

Math check for the 1,000 kWh row: energy 1,000 x $0.13 = $130.00. Delivery $4.90 + (1,000 x $0.065 = $65.00) = $69.90. Add the $5.00 base charge: $130.00 + $5.00 + $69.90 = $204.90. Take off the $80 credit: $124.90.

What real Houston-area customers say

This is what people post when the cliff catches them. These are quotes from public posts, not proof of how any one plan works. We name the source type only.

“They enticed me with a bill credit if we were at 1000kwh to 1500kwh. … One month we ended up spending $216 for 950kwh.”

Reddit, r/texas thread “Warning: Power to get ripped off”

“Apparently the $100/mo th discount for usage over 1000kw is null if you go over 2000kw. So a $200/month bill for 1900 kw becomes a $700/m bill for 2200kw.”

Same Reddit thread

Both match our example: a small miss on either side of the range costs a lot more than the extra kWh would suggest.

Who should not pick a bill credit plan

A credit plan can be a good deal. It is a bad fit for some homes. Think twice if any of these sound like you:

• Your usage swings a lot. Hot summers, cold snaps, guests, a home office. If you land under the line even one month in the year, that month can hurt.
• You sit close to an edge. If your normal month is 950 or 1,990 kWh, a small change decides everything.
• You are new to the house. You do not know your real usage yet. Wait for a few bills before you rely on a credit.
• You want a bill you can guess. A plain plan with one price per kWh is easier to predict.

In our example, a plain plan with no credit and no base charge would beat the example plan at 900 kWh if its energy charge were under about 13.6 cents. That is a hypothetical, but it shows why you should price a plain plan next to every credit plan.

When your contract ends: the holdover trap

The cheapest plan today can turn into an expensive one later. When a fixed-term contract ends and you do nothing, many providers move you to a month-to-month plan. People call this a holdover rate. It is often much higher than the price you signed up for.

“my 12 month contract had expired. I was paying 12c ish, the rate they jumped me too was 21c.”

Reddit, r/texas thread “Warning: Power to get ripped off”

That is one person’s story, not a rule for every provider. The fix is simple: put your contract end date in your phone calendar a month early. Check your last bill, too. If the energy price per kWh jumped and nothing changed at your house, your contract may have ended.

Two tools can help. Our holdover rate calculator shows what a higher rate may have cost you. Our guide on what to do if you never got a notice explains your next steps.

How to find your own cheapest bill in 5 steps

1. Get your real usage. Log in to your provider or Smart Meter Texas, or read the last 12 bills. Write down every month’s kWh, not just the average.
2. Pull the EFL for each plan you like. Find the energy charge, base charge, bill credit range, contract length and cancellation fee.
3. Add the delivery charge. Some EFL prices already include it. If one does not, add the CenterPoint fee yourself.
4. Do the math at three usage levels. Try your low month, your average month and your high month. Use the example table above as a pattern.
5. Pick the plan with the best worst month you can live with. A plan that is a little cheaper on average but explodes in July is not cheaper.

For context only: the U.S. Energy Information Administration says Texas homes paid an average of 15.88 cents per kWh in July 2026.^[3] That is a statewide average of what people paid, not a Houston price and not a plan offer. Do not use it to judge a plan.

Want to skip the math? Our plan comparison lets you enter your ZIP code and your kWh. You can also try the Texas electricity rate calculator, or read our guide to comparing plans on Power to Choose.

Check your usage against real plans

Now you know what to look for. Plug in your own kWh and read the EFL before you sign. If you are close to a credit edge, treat that plan with care.

Frequently asked questions

What is the cheapest electricity rate in Houston right now?

It changes often and it depends on your usage. Sites quote different “cheapest” rates because each one picks a different usage level and a different way of counting delivery. The better question is which plan gives the lowest bill at your kWh.

Why is my Houston electric bill higher than the rate I was shown?

The rate you saw may apply at only one usage level. Your bill can also include a base charge, the CenterPoint delivery fee, and taxes, and it may have lost a bill credit you missed by a few kWh.

How much is the CenterPoint delivery charge?

As of October 2026 it is about $4.90 a month plus roughly 6.4 to 6.5 cents per kWh, and a final state order was still pending in mid-October. Check CenterPoint’s tariff page for the current number.

Are bill credit plans a good idea?

They can be, if your usage stays inside the credit range every month. They are risky if your usage swings or you sit near an edge. Price a plain plan next to it before you choose.

What happens when my electricity contract ends in Texas?

Many providers move you to a month-to-month plan, and the price can be higher than your old one. Mark your end date on a calendar and shop a month before it.

What is an Electricity Facts Label?

It is a standard sheet every plan must have. It lists the average price at 500, 1,000 and 2,000 kWh and the fees and terms. It is the best place to check a plan before you sign.^[1]

Sources

1. Public Utility Commission of Texas: Electricity Facts Labels
2. CenterPoint Energy: Rates and Tariffs
3. U.S. Energy Information Administration: Electric Power Monthly, Table 5.6.A
4. BKV Energy: CenterPoint delivery charge increase, September 2026
5. VIP Energy Service: Houston CenterPoint delivery charges and bill impact