How to Read an Electricity Facts Label

What is an Electricity Facts Label?

The Electricity Facts Label is a standardized disclosure document required by the Public Utility Commission of Texas (PUCT) for every retail electricity plan sold in the deregulated Texas market. Think of it as the nutrition label for your electricity plan — it must be publicly available before you sign up.

You can find EFLs on PowerToChoose.org by clicking any plan's "Facts Label" link, or directly on a provider's website. WattPal downloads and parses every EFL on PowerToChoose daily using AI, so you never have to read them manually.

The benchmark price table — the most important section

Every EFL shows an Average Price per kWh at three usage levels: 500 kWh, 1,000 kWh, and 2,000 kWh per month. This is the single most important part of the label, and also the most misunderstood.

Providers are allowed to advertise the lowest of the three numbers — usually the 2,000 kWh rate — in big print. A plan advertised as "5.9¢" might cost you 14.2¢ if you use 500 kWh in a mild-weather month. This is legal and extremely common.

What the prices actually include: The average price at each level is all-in — it includes the energy charge, your TDU (utility) delivery charge, any monthly customer fee, and any bill credits. It does not include one-time enrollment fees or sales tax.

How to use the table: Find the column closest to your typical monthly usage. If you use 1,800 kWh on average, the 2,000 kWh column is your best proxy — but it won't be exact because the benchmark assumes flat usage, while real usage swings seasonally. That's exactly why WattPal runs the math against your actual 15-minute interval data.

Bill credit traps ⚠️

This is the most common way Texas electricity plans look cheaper than they are. A bill credit trap works like this:

• The plan charges a normal energy rate at all usage levels.
• But it gives you a $X bill credit — only if your usage hits a specific threshold (usually 1,000 kWh or 2,000 kWh).
• The EFL benchmark at 2,000 kWh looks fantastic because the credit is applied. At 500 kWh, there's no credit, so the price looks high.
• In months when your usage falls short — mild spring/fall months — you lose the credit entirely and pay a much higher effective rate.

Real example: A plan might show 14.1¢ at 500 kWh, 14.0¢ at 1,000 kWh, and 6.5¢ at 2,000 kWh. That dramatic drop from 14¢ to 6.5¢ is a $150 credit that only applies at exactly 2,000 kWh. Miss it by 100 kWh and you pay 14¢ for the whole month.

Time-of-use (TOU) and free-window plans

Free nights, free weekends, and free daytime plans are a category of Time-of-Use (TOU) plans. The EFL will state the specific hours the free window applies and what the paid energy rate is outside that window.

Common free-window types in Texas

The benchmark problem with TOU plans: The EFL assumes a standard free-window usage fraction (e.g., 35% of usage falls in the free window) when calculating the average price. Your actual split almost certainly differs. If your nights are busier than average, a free-nights plan will beat the benchmark. If you're rarely home at night, it'll underperform.

Base charge and customer charge

Many plans charge a flat monthly fee regardless of how much electricity you use. On the EFL, this appears as "Base Charge," "Customer Charge," or "Monthly Service Fee." It's separate from your energy rate.

A $9.95/month base charge adds roughly 1¢/kWh to your effective rate if you use 1,000 kWh — but nearly 2¢/kWh if you use 500 kWh. The EFL benchmark already folds this into the average price at each usage level, so you'll see its effect in the 500 kWh column. Low users should pay special attention to this line.

Your TDU also charges a customer fee. Oncor charges $4.06/month; CenterPoint charges $4.90/month. These TDU fees are included in the EFL's average price but are not charged by your REP — they flow through your electricity bill regardless of which plan you choose.

One-time and hidden fees

The EFL benchmark prices do not include one-time fees. These must be disclosed in the EFL fine print but are easy to miss because they don't affect the headline ¢/kWh number.

• Enrollment / connection fees — Some plans (particularly broker-channel plans) charge $25–$99 to enroll. This can erase months of savings on a plan that otherwise looks cheap.
• Deposit requirements — Providers may require a deposit for customers without established credit history. The EFL must disclose whether a deposit may be required.
• Disconnect / reconnect fees — Charged if your account becomes delinquent. Not plan-specific but disclosed on the EFL.

Early termination fees (ETF)

Fixed-rate plans almost always charge an early termination fee if you cancel before the contract ends. The EFL must disclose the exact ETF amount or formula.

ETFs vary widely:

• Flat fee — $150–$250 regardless of when you cancel. Common on 12-month plans.
• Per-month remaining — e.g., $20 × months left. Canceling at month 6 of a 12-month plan costs $120.
• No ETF — Month-to-month plans and some promotional plans carry no penalty. These usually have higher energy rates.

Always factor the ETF into your decision, especially if you might move. A plan with a $175 ETF needs to save you more than $175/year vs. your current plan to be worth switching to.

Auto-pay and paperless discounts

Many plans require auto-pay and paperless billing to receive the advertised rate. The EFL will state that the price is conditional on these requirements, usually with a note like "Price reflects a $X/month discount for autopay and paperless billing."

If you don't enroll in auto-pay, your actual rate will be higher than the EFL shows. This is a legal requirement to disclose but easy to overlook. WattPal's fine-print flags highlight when a plan has auto-pay conditions.

Contract length

The EFL states the contract term — typically 6, 12, 24, or 36 months, or month-to-month. Longer contracts usually offer lower rates but carry higher ETFs and lock you in if rates drop.

In Texas's volatile electricity market, 12-month fixed-rate plans tend to be the sweet spot for most households — enough price certainty to plan around, without a multi-year lock-in.

Renewable energy percentage

The EFL discloses the fuel mix — what percentage of the plan's electricity comes from renewable sources (wind, solar, etc.) vs. natural gas, coal, or nuclear. "100% renewable" plans are common in Texas and don't always cost more, because Texas has abundant wind generation.

RECs vs. matched generation: Some plans use Renewable Energy Certificates (RECs) to claim 100% renewable status without delivering electrons generated by a wind turbine to your home. This is legal and standard practice in the industry — the grid delivers the same electrons regardless. If you care about additionality, look for plans that explicitly invest in new renewable capacity.

How WattPal uses EFLs

WattPal downloads every EFL on PowerToChoose daily and uses Google Gemini AI to extract the exact rates, fees, TOU windows, fine-print flags, and conditions from each PDF. Then, when you upload your SmartMeter CSV, WattPal:

1. Parses your 15-minute interval data to calculate your real monthly usage profile — including how much usage falls in each TOU window.
2. Applies each plan's exact energy rate structure (not the benchmark) to your actual usage month by month.
3. Adds your TDU delivery charges (which are the same regardless of plan) to get a true all-in monthly cost.
4. Adds any one-time enrollment fees to the annual total so they're reflected in the ranking.
5. Flags bill credit traps, auto-pay requirements, ETFs, and other fine print so you can make an informed decision.

The result is a ranked list of every fixed-rate plan on PowerToChoose, sorted by your actual projected annual cost — not a benchmark that may not match how you use electricity.