Staying with your electricity provider after a renewal rate increase can be the right call, but only after you check the new rate against real alternatives for your ZIP code. Texas electricity customers get a renewal offer weeks before their contract ends, and that offer often carries a higher rate than what a brand-new customer would get from the same company.
The number on that renewal notice is a starting point for comparison, not a final decision. This guide walks through how to weigh a renewal against switching or riding out a month-to-month rate, and how to make whichever move you choose without paying a fee you didn’t need to pay.
Your electricity bill reflects the plan you pick today for months to come, so it pays to slow down before signing anything.
Should You Renew, Switch, or Go Month-to-Month?
Staying with your current retail electric provider makes sense when the renewal offer beats or closely matches other plans for your usage and ZIP code. Switching makes sense when a competitor’s plan clearly costs less over a year.
Going month-to-month works best as a short bridge, not a long-term plan, since that default variable rate can move every billing cycle.
Your Texas electricity contract has a contract end date printed on your bill and in your original Terms of Service. Around 30 to 60 days before that date, your provider sends a renewal notice, sometimes called a contract-expiration notice, offering a new term at a new rate.
This is standard practice across companies like TXU Energy, Reliant, Gexa, Direct Energy, and Rhythm.
Why a Higher Renewal Offer Is Not an Automatic Reason to Leave
A higher renewal rate doesn’t automatically mean you should switch providers. Wholesale electricity prices across the ERCOT grid shift with weather, fuel costs, and demand, so every retail electric provider adjusts pricing at renewal time, not just the one billing you now.
If your current provider’s renewal rate lines up with what new customers are paying elsewhere for a similar fixed vs. variable rate plan, staying put avoids the hassle of switching and any risk tied to an unfamiliar company’s billing practices.
How to Compare Renewal Pricing With Other Available Plans
Compare your renewal offer against current market plans using your actual monthly kWh, not the advertised average. Pull your last 12 bills, note your usage in a low month and a high month, and calculate the total cost of the renewal at both levels.
Then do the same math for two or three other plans available at your ZIP code. A plan that looks cheaper on paper can cost more once you add base charges and TDU delivery fees at your real usage.
What Happens If You Do Nothing at Contract Expiration
If you take no action, your provider typically shifts you to a default renewal product, usually a month-to-month variable rate sometimes called a holdover rate. This default rate is not locked in and can run well above your prior fixed rate, since it moves with the provider’s own pricing decisions rather than a set contract term.
Your electricity bill will still bill correctly, and delivery through your transmission and distribution utility, the TDU, continues without interruption. The financial risk is cost, not service.
When Staying With the Same Provider Can Still Make Sense
Staying with the same provider can be the smart move when the renewal rate is competitive, when you have billing or autopay setup you don’t want to redo, or when a satisfaction record with that company outweighs a small savings elsewhere. Loyalty pricing is not guaranteed, so this only holds up if you’ve actually checked the numbers first.
You can always compare available Texas electricity plans side by side before deciding to renew. Even if you plan to stay, taking a quick look confirms you’re not overpaying.
How to Make the Change Without Avoidable Costs
Whether you renew, switch, or let the contract lapse, the biggest financial risk is paying an early termination fee (ETF) you didn’t need to pay. PUCT rules, specifically 16 TAC §25.475, protect a qualifying switch scheduled in the final 14 days of your fixed term from that penalty.
Timing your move correctly is the difference between a clean switch and an unnecessary charge.
Find the Real Contract End Date and Your Penalty-Free Window
Your contract end date is the exact day your current pricing terms expire, and it’s not always the same as your next billing date. Check your most recent bill, your online account, and your Terms of Service to confirm it.
Once you have that date, count back 14 days. Under §25.474 and §25.475, a properly scheduled switch inside that final 14-day window generally avoids the ETF tied to leaving a fixed-rate plan early.
Get written confirmation of your exact end date from your current retail electric provider if the documents conflict.
Read the Renewal Offer and Electricity Facts Label Before Accepting
Every renewal offer and every competing plan comes with an Electricity Facts Label (EFL), and this document is where the real pricing terms live. The EFL lists the energy charge, base charge, TDU delivery charges, contract length, and any bill credit conditions.
Don’t accept a renewal just because it’s the first offer in your inbox. Pull the EFL for the renewal and for at least two competing plans on Power to Choose or another current comparison tool, and read the Terms of Service for each before signing anything.
Test Each Plan at Your Actual kWh Usage
Compare plans using your real monthly kWh, not the 1,000 kWh figure shown in most ads. Test each plan at 500, 1,000, and 2,000 kWh, plus your own lowest and highest usage months from the past year.
A bill-credit plan can look cheap at exactly 1,000 kWh and turn expensive at 900 or 1,500 kWh. Run the math for your household before comparing headline rates.
| Usage Level | What to Check |
|---|---|
| 500 kWh | Base charge impact, minimum-use fees |
| 1,000 kWh | Bill-credit threshold, advertised rate accuracy |
| 2,000 kWh | Whether credits or discounts hold at higher use |
If your numbers show clear savings elsewhere, it’s worth taking the next step to compare electricity rates for your address using your actual usage figures.
Schedule a Switch Without Interrupting Electricity Service
A properly timed switch keeps your electricity on without any gap. The TDU, whether that’s Oncor, CenterPoint Energy, AEP Texas, or another delivery company, keeps running the poles, wires, and meter no matter which retail electric provider bills you.
Enroll with the new provider and let them submit the switch request through the market process. Don’t cancel or request a disconnect from your old provider yourself, since that’s a different transaction that can actually cut your power.
Confirm the new service start date matches the day your old plan ends.
Check the First Bill After Renewal or Switching
Your first bill after any change should match the EFL you saved before enrolling. Compare the plan name, energy charge, base charge, TDU charges, and any bill credit with the details you signed up for.
If something doesn’t line up, contact the provider in writing and point to the specific line item in question. Attach your EFL and enrollment confirmation, too. Keeping that paperwork handy makes any billing dispute much easier to resolve.
Once your new plan is confirmed and running smoothly, it’s a good habit to check current electricity plans again at your next renewal. Before long, the process will feel a whole lot easier.