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Average Electric Bill in Texas

average electric bill in Texas

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Are you interested in knowing the average electric bill in Texas? Are you worried about the rising cost of electricity and curious about what that means for you and your family? We had some record-breaking winter weather hit Texas in February, and those scorching summer days are fast approaching. What can we expect from July and August?

When we’re talking about the heat, the most obvious solution is to blast the air conditioner on its lowest setting and hope that your house has enough insulation that it doesn’t become an oven. If you do that, though, your electricity bill is going to go through the roof. No one wants that, but do we even have a choice?

Many Texas residents don’t. It’s been a trying economic period in U.S. history, and some people simply can’t afford an electric bill that equals the price of their rent. It’s unconscionable.

Luckily, there are some pretty simple solutions to get you prepared for summer and help reduce electricity costs. Whether you’re doing a little or a lot, every reduction is bound to help. Before we get into the steps you can take to lower your electric bill, let’s take a look at the average electricity bill in Texas.

What is the Average Electric Bill in Texas?

Well, the average cost of electricity in Texas is 11.98 cents per kWh (kilowatt-hour). The average Texas home uses 1,176 kWh per month or 14,112 kWh per year. To many people, those are just numbers on a page because they don’t work in the energy sector and don’t know how many kWh’s they actually use or how those averages relate to them.

Let’s break it down to dollars.

The average price of an electric bill in Texas is $140.88. Of course, Texas is a large state. If you live in Houston, your electric bill will be around $155.74. In Dallas, the average electric bill is $112.36. In Austin, the average cost for utilities for an apartment (including electricity, water, heating, and garbage) is about $171.43. And it varies in more rural areas. 

In the summer, residents in Houston, Texas, with a 2,400 sq ft home, can expect electricity bills around $288. Inclement weather has a significant impact on electricity usage. 

Just take a look back at February. Many people were experiencing electricity bills as high as $15,000 due to the severe winter storm that froze most of Texas for a short time. Of course, it’s important to remember that was an anomaly and is not typical of electric bills in Texas.

But it did happen.

The Rising Cost of Electricity

While we have to expect that there will be higher temperatures this summer, we will also experience much higher electricity bills. According to experts, Texas residents should experience a 2.8% increase in electricity costs in 2021 compared to 2020. 

Putting that into simple math, if you’re currently paying $100 a month, you’ll now be paying about $102.80. In the summertime, when your electricity bill is around $300, that’ll be about $308.40. That doesn’t seem like a lot, right? 

Well, it isn’t about what happens in one year. It’s about what happens in 10. If the rates keep increasing every year by 2.8%, then in 10 years, the cost of electricity will have risen by 28%. That’ll turn your average $140 bill into a $180 bill and your average $300 summer bill into a $380 summer bill. That’s a big difference.

This is a trend that isn’t stopping. If we don’t do something to soften that curve, it will worsen. This price increase directly correlates to the price of natural gas and oil. In such a volatile market with a limited supply that is often wrapped up in political strife, it’s easy to see why these sudden shifts happen.

Fortunately for us, the renewable energy market is doing a ton of work to combat this problem. Unfortunately, until we’re completely free of our dependence on oil and natural gas, we have to think of some other solutions for these rapidly increasing electricity bills.

Saving Money on Electricity Bills in Texas

The first step to save money on your electricity is understanding how much electricity you’re using. This starts with doing what we in the business call “an audit.” And, no, this has nothing to do with taxes. 

An energy audit is an itemized list that allows you to determine which items in your home are using electricity, how much they’re using, which ones are using the most, and how much each individual item costs you. Once you have that information, a lot of things become apparent pretty quickly. You can easily request this information from your utility company.

9 Tips to Save Money on Your Texas Electric Bill

There’s no quick fix to reducing the cost of your electric bill in Texas, but here’s a list of 9 things to help you get started.

  • Adjust the settings on your fridge. 

Many people keep their refrigerator temperature settings too low because they don’t know that they can change them. This is an unnecessary waste of electricity.

  • Replace the filter in your A/C. 

A clogged filter can make your HVAC system run improperly and really crank up that electric bill.

  • Regulate temperatures based on the season. 

When it’s wintertime, let it be a little colder than usual. When it’s summertime, let it be a little warmer. A little really goes a long way. 

  • Choose designated laundry days. 

Instead of doing the laundry whenever the basket is half empty at irregular times with irregular load sizes, pick a day of the week to do all the laundry. This will allow you to do bigger loads, decreasing the number of cycles you have to do in total.

  • Use energy-efficient light bulbs. 

This may feel like a small thing to do, but it works. Energy-efficient lightbulbs may only take off cents from your electric bill, but if you do enough of these small things, it’ll add up quickly. 

  • Completely load your dishwasher. 

This is similar to the laundry day tip. You want to make sure your dishwasher is completely full before you run it. This allows you to do fewer cycles, saving electricity.

  • Have someone check to see if your house is properly insulated. 

Improper insulation can make your home impossible to keep warm or cool. Getting this fixed can save you a ton of money on electricity because it helps regulate one of the biggest energy spenders – your air conditioner. 

  • If you’re not using it, turn it off. 

This is another simple and straightforward option that can really add up. If you’re not in a room, turn the lights off. If you aren’t using something, turn it off. Consider unplugging it. Don’t pay for something to just sit around and suck electricity. 

  • Convert your home into a smart home. 

Smart homes are incredibly energy-efficient and allow you to significantly reduce your electricity bill.

Electric Companies in Texas

There are over 70 electricity providers across Texas, many of whom even offer renewable energy choices. These providers offer electricity from a few different utility companies:

  • Oncor Electric Delivery
  • CenterPoint Energy
  • AEP Texas North
  • AEP Texas Central
  • Texas-New Mexico Power Co.

These utility companies operate all over Texas and are responsible for almost all of the state’s electricity. Texas also houses a few co-op organizations, which are non-profit programs owned and operated by the people who use their services. 

Believe it or not, Texas even has its own grid system, called the ERCOT grid, which powers almost 90% of the state. This grid operates independently of the rest of the United States.

Does Texas Have a Regulated or Deregulated Energy Market?

In a regulated market, there are only a few companies that are allowed to offer energy services. The price of electricity is determined by a council, and there are few options to circumvent that cost. Most states within the U.S. are regulated. Regulated markets are intended to provide long-term stability and formal regulation.

In a deregulated market, those rules don’t exist. Any company can pay to access the electrical grid (ERCOT) and provide electricity to customers. They independently determine the price of electricity. This results in a competitive market that ultimately serves its customers because it allows for alternative options. Of course, it also means that companies can charge whatever they want, and no one can stop them. 

Texas’ energy market has been deregulated since 2002. There are mixed reviews about whether this has served Texas residents, but the evidence is clear that a deregulated market has not worked out in favor of consumers. 

While it’s true that some people have saved money due to the deregulated market, many have suffered. In fact, a study shows that Texas residents could have saved more than $27 billion between 2002 and 2016 if the market had been regulated. While electricity prices are on the rise in the entire country – Texas is getting hit especially hard because its energy market is deregulated.

How Much Money Can Texas Residents Save by Switching to Solar?

According to the Texas state government, more than 210,000 Texas residents have made the wise decision to switch to solar. That number is only increasing, and there’s a good reason why.

The average cost of a 5-kW solar panel system is around $15,000. Using the FTC (Federal Tax Credit), you can reduce that cost by 26%, making it just over $11,000. Since solar panel systems have a 30-year lifespan, and let’s say you generate enough electricity with your solar panels that you don’t have to pull from the grid anymore, then you’ll pay $11,000 for the next 30 years of electricity, give or take.

Now, let’s compare that to the cost of electricity without solar. The average electric bill in Texas is $140.88. Over that same 30 years, with no rate increases (which is virtually impossible), you’ll pay $50,716.80.

That’s a lot of money! By switching to solar, you could potentially save almost $40,000 over the next 30 years. That’s why so many Texas residents are making the switch to renewable energy.

Take the Power Back

We all saw what happened when Texas residents relied on the Texas energy market to keep them safe during the winter storm in February 2021. They couldn’t. You can’t take a backseat anymore and expect everything to be okay. If you make the switch to solar, then you’ll have the power in your own hands, and you’ll save a bunch of money on electricity in the process.

In fact, if you get a solar battery, you won’t have to worry about whether or not the grid system is down because you’ll have enough stored energy to power your home until the sun comes out—no need to deal with rolling brownouts ever again.

Final Thoughts

You must keep an eye on your electricity bill. The cost of energy is rising. We’re seeing it every year, and it’s not going to stop. In a deregulated market, that’s a really dangerous thing because it means that utility companies can charge whatever they want. Who’s to stop them?

Do something now, before the market gets way too out of control. Perform an energy audit, follow as many of our tips as you can to reduce your Texas electricity bill, and think about making the switch to renewable energy.