Average Payment Plan

An agreement worked out between a REP and a customer, which allows you to pay approximately the same amount for your electricity each month, with the balance to be trued-up periodically to account for over- or under- payments. All Retail Electricity Providers are required by the PUC to offer average payment plans.

Auto-Pay / Auto-Debit

A retail electric provider (REP) may offer customers an option which allows automatic payment of electric bills from a customer’s bank account or credit card. Please contact the REP for additional information regarding the terms and conditions relating to auto-pay / auto-debit.

Base Charge

Flat fee applied each month regardless of the amount of kilowatt(kWh) used.


Complaints concerned with the amount a customer has been billed or any rule or tariff having to do specifically with the billing of the customer’s account but also include:

  • State Program & Fees
  • No Bill Received
  • Deposits / Refunds
  • Rates / Charges

City-Owned Utility

A non profit utility owned and operated by the city it serves. In Texas, city-owned utilities may opt into the competitive retail electric marketplace. See also "Municipally Owned Utility."

Commercial Customer

One of four commonly used designations for classes of customers. The others are Residential, Small Commercial and Industrial. Commercial customers are not involved in manufacturing. Examples of commercial customers include retail stores, restaurants, and educational institutions with a peak demand of 50kW or more during any 12-month period.


Adding charges to a bill without a customer's approval. This practice is illegal, with penalties administered by the PUC. Learn more.

Electronic Billing (E-billing)

E-billing is when a retail electric provider (REP) delivers its invoices and bills electronically rather than sending it by postal mail delivery. REPs may require customers who enroll in an e-billing product to only pay their electric bills electronically or to enroll in autopay. (See Auto-Pay / Auto-Debit).


Complaints concerned with disconnection of service but also include:

  • Lack of appropriate notice
  • Service is disconnected with a payment plan in place
  • Amount due in dispute

Distributed Renewable Generation (DRG)

A program for customers who own small-scale renewable power systems, such as solar panels, and who want to sell excess power back to their electric company. Learn more.

Electric Cooperative (Co-op)

A customer-owned electric utility that distributes electricity to its members. In Texas, co-ops can choose to opt into the competitive retail market.

Electricity Facts Label (EFL or Fact Sheet)

A fact sheet that provides customers with standardized information about an electric plan, including contract terms, pricing, fees, and the percentage of renewable energy offered. The PUC requires an EFL for every plan so that customers can make an "apples-to-apples" comparison of the different offers.

Electric Reliability Council of Texas (ERCOT)

The corporation that administers and maintains the reliability of the state's electrical power grid. When you choose a new electric company, ERCOT will send you a mailer confirming your switch.

Electric Service Identifier (ESI ID)

In the state of Texas, an ESI ID is a 17 or 22-digit number used in the deregulated market to identify a unique point of electric service delivery to a premise (your home or business).

Fixed-Rate Plan

A fixed-rate plan has a set rate that doesn't change throughout the contract period, with minor exceptions. If you choose a plan with a fixed rate, your price per kWh will not change during your contract period except for changes in Transmission and Distribution fees, changes in ERCOT or Texas Regional Entity administrative fees, or changes resulting from federal, state or local laws that impose fees beyond your REP’s control. This may help your household budgeting, but if market prices fall you may have to wait until your contract ends to enjoy a lower price.


The production of electricity. In Texas, electricity is produced by a number of methods, including natural gas, coal, nuclear power, wind, water, biomass, and solar energy.

Industrial Customer

One of four commonly used classes of customers. The others are Commercial, Small Commercial and Residential. Industrial customers typically have the highest demand for electricity. Examples of industrial customers are a factory or manufacturing plant.

Indexed Rate Plan

An indexed rate plan (also called market rate plan) is similar to a variable plan in that the price per kWh can go up or down each month. The difference is that the rates for these plans are directly tied to a pricing formula connected to a publicly available index. If the index rises, your monthly rate will also, but if the index falls, your rates will be lower.

With an indexed plan, the price per kWh can change substantially each month, giving benefits and risks similar to those of variable rate plans. The difference is that the rates for indexed rate plans are tied to a publicly available index. Customers considering these plans should ask the electric company for specifics about the pricing formula as well as how and when they will receive notifications of changes to the index.

Kilowatt-Hour (kWh)

A unit of energy equivalent to one kilowatt (kW) of power expended for one hour of time. The amount of electricity you use each billing period will be expressed on your bill in terms of kilowatt-hours.

Local Wires Company

Formerly called a local electric utility or a Transmission and Distribution Utility, this company is responsible for delivering electricity to your area, reading your meter, and maintaining the poles and wires.

Minimum Monthly Fee

Many plans require you to use a minimum amount of electricity each month. If you use less than the minimum amount, you will automatically be charged a fee, sometimes called a "minimum usage charge." This fee may or may not be listed separately on your monthly bill, so it is important to check the electricity facts label for your plan. Not all companies charge this fee or require you to use a minimum amount each month. Some companies offer credits or waivers of other fees for using a certain amount of electricity. Our shopping tool allows you to see if a company requires a minimum electricity usage and if there is an associated fee or credit.

Municipally Owned Utility ("Muni")

A non profit utility owned and operated by the municipality it serves. In Texas, municipally owned utilities may opt into the competitive retail electric marketplace. See also "City-Owned Utility."

Peak Demand

The highest 15- or 30-minute demand period recorded during a 12-month period.

Prepaid Electric Service

Electric service in which the customer makes advance payments for electricity. Service is provided on a "pay-as-you-go" basis, with usage calculated daily via a smart meter or other specialized device.

Provider of Last Resort

The Provider of Last Resort (POLR) serves as the "back-up" provider when an electric company leaves the market for any reason. If this happens, customers may opt for service from the POLR or switch to another retailer.

Provision of Service

Complaints concerned with:

  • Initiation of service
  • Timely startup
  • Refusal of service
  • Customer Service

Public Utility Commission of Texas (PUC)

The state agency responsible for the regulation and oversight of electric and local telecommunication services in Texas. The PUC regulates the delivery of electricity and enforces customer protections. Learn more.

Quality of Service

Complaints concerned with physical problems, such as power surges or power outages with electric service.

Renewable Energy

Electricity made from environmentally friendly fuel resources, such as wind, water, biomass, or solar. The percentage of renewable energy that a plan offers can be found on the Electricity Facts Label.

Residential Customer

One of four commonly used customer classes. The other three are Commercial Small Commercial, and Industrial. Residential customers include private households that use energy for heating, cooling, cooking, lighting, small appliances, and the like.

Retail Electric Provider (Electric Company or Provider)

Commonly called electric companies, Retail Electric Providers (REPs) sell electricity to customers. They do not generate electricity, read meters, or operate or maintain transmission or distribution wires. All REPs must be certified to do business by the Public Utility Commission of Texas.


Switching electric service without a customer's approval. This practice is illegal and penalties are administered by the PUC. Learn more.

Small Commercial Customer

One of four commonly used customer classes. The other three are Residential, Commercial, and Industrial. A small commercial customer includes businesses whose peak electric demand during any 12-month period is less than 50kW.

Terms of Service (TOS)

A contract between a Retail Electric Provider and a customer, which outlines fees, length of service, and other important information.

Time Of Use

Time-of-Use plans include incentives to use power during certain periods such as nights or weekends. The average price calculations for Time-of-Use Plans shown on the REP’s Electricity Facts Label and the Power to Choose website are based on the REP’s estimation of the percentage of energy used during free or discounted hours versus non-free or premium non-discounted hours. These estimates and hours vary from REP to REP and from plan to plan. Please note that the average price you pay will vary depending on your actual usage of energy during the free versus non-free hours. Shifting your usage to the discounted times will maximize your benefit from the plan. If you do not shift your usage, your bill may actually increase. Please contact the REP for further information and to determine if the Time-of-Use Plan is right for your energy usage.

Transmission and Distribution

The actual delivery of electricity over poles and wires to your home or business. These services are provided by your local wires company (often called the Transmission and Distribution Utility), which is responsible for maintaining the poles and wires and responding to emergencies and power outages. The PUC regulates transmission and distribution to ensure the safety and reliability of your electric service.


Usage is the amount of electricity used during the billing period. Usage is measured in kilowatt-hours (kWh) and will be listed on your electric bill as "kWh used."

Variable Rate Plans

Variable rate plans have no monthly contract or cancellation fee, but the rate you pay per kWh can vary from month to month. Your rate can go up or down based on the market and the discretion of your electric company. Variable plans allow customers to benefit from falling market prices, but they also have an increased risk for higher rates if electricity prices spike due to natural disasters, cold winters, or adverse market conditions. The rates different companies charge each month varies, but because customers can switch any time, companies have an incentive to keep their rates low.

Your Rights As a Customer Disclosure

A document that informs you of your rights as mandated by the PUC. Your electric provider must provide you with this disclosure.