Texas electricity prices typically drop in the fall. However, after an unusual 10% price decline this summer, we expect rates to remain mostly flat through the end of the year.
Summer 2026 Texas Electricity Rates Were Unusually Low
This summer had all the ingredients for high prices, including a strong El Niño pattern and forecasts for above-average hurricane activity. Instead, Texas experienced a milder summer without major weather events, dropping electricity rates by 10% from June to August 20261.
Because Texas hosts more data centers than anywhere else in the country, demand records were expected to break this summer, and they did. ERCOT set a new all-time peak demand record of 92,211 MW on July 22, 2026, 8% above the prior record set in 2023. However, Texas also set record output for solar generation and battery storage.
- Solar power covered more demand than ever. Solar now generates 14% of Texas power. On July 22, when the grid hit a new peak record? Solar exceeded 45% of all power being generated. Cheap daytime solar reduced wholesale costs across the day, and that pattern continued most of the summer.
- More battery storage online: Batteries charge during the day, when solar is abundant and cheap, then discharge as the sun sets. This extends low-cost power into the evening, reducing reliance on higher cost coal and natural gas-powered generation.
Wholesale power prices depend on the fuel source. Solar, wind and battery have zero fuel cost once built, whereas natural gas and coal-generated power prices fluctuate with market costs for fuel. More solar, wind and battery on the grid meant lower wholesale costs and lower prices for consumers during summer 2026.
Fall 2026 – Texas Electricity Rates Will Remain Stable
As temperatures drop, the air conditioning runs a little less across the state and demand falls. With falling demand, Texas prices typically start to drop in September, with rates remaining low though December. Historically, fall rates drop by around 5% vs. summer. With prices already suppressed coming out of the summer we expect prices will remain stable or drop only slightly as the weather cools.
With rates falling, should I switch my electricity provider? You can switch to a new electricity plan even if you’re in a contract. You may need to pay early termination fee, so factor that in to your savings calculation. This article helps you estimate how much you can save by switching and whether it’s worth it.
How to Find the Best Electricity Rate in Every Season
No matter the time of year you’re shopping in, avoid those advertised rates that are too good to be true. Providers love to boast of that 7¢ per kWh average price at exactly 1000 kWh. But look behind the advertised price and you’ll find an energy rate that’s easily twice that price, with a bill credit making the advertised price look cheap at one specific usage level.
Here’s a current example of a bill credit plan in Oncor/Dallas area:
- Advertised Price: 7¢/kWh at 1000 kWh
- Energy Rate: 13.065¢/kWh
- Delivery Charge: 6.03¢/kWh + $4.06/month
- Bill Credit: $125 for usage over 1000 kWh
| Usage | Bill Credit Earned? | Effective Rate | Estimated BIll |
|---|---|---|---|
| 950 kWh | no | 19.52¢/kWh | $185.46 |
| 1000 kWh (advertised price) | yes | 7¢/kWh | $70.01 |
| 1700 kWh | yes | 11.95¢/kWh | $203.68 |
| Electricity plan offering $125 bill credit at 1000 kWh. Energy rate 13.065¢/kWh | |||
This is why we encourage consumers to shop based on their usage, not just the advertised price.
Our BillSmart™ Tools show what you’ll actually pay:
- BillSmart Low Bill Finder estimates your month by month usage based on a single input, and highlights the cheapest plans for you.
- BillSmart Calculator lets you enter any usage level to see how your bill will change.
- CostCurve™ gives you a clear visual in chart form, to see how your bill changes based on usage.
- BillSmart Plan Score warns you away from plans that will give you unpredictable bills, on a simple 5-point scale.
Always compare rates at your usage level, not just the headline advertised number. Ask yourself, “what’s my rate if I use 800 kWh or 1500 kWh, not 1000 kWh?” You’ll know the answer when you use BillSmart Tools.
What are Current Electricity Rates in Texas?
Here are the cheapest bill credit electricity plans and cheapest basic fixed rate electricity plans in Houston and DFW. Enter your zip code to shop rates in your area.
The cheapest electricity rate in Houston as of September 9, 2026 is 7.2 ¢/kWh with Gexa Energy Gexa Eco Saver Plus 12 or with Frontier Utilities Frontier Saver Plus 12 or with 4Change Energy 4Change Maxx Saver Value 12. Other providers like Discount Power, Cirro Energy also offer competitive rates starting at 7.3 ¢/kWh. These are average prices based on 1000 kWh a month.
The cheapest basic fixed electricity rate in Houston as of September 9, 2026 is 12.9 ¢/kWh with APG&E Electricity Plans 10. Other providers like Champion Energy Services also offer competitive basic fixed rates starting at 13 ¢/kWh. These are average prices based on 1000 kWh a month.
The cheapest electricity rate in Dallas as of September 9, 2026 is 6.6 ¢/kWh with APG&E Simple Saver Smart Credit 12. Other providers like Gexa Energy, Frontier Utilities, 4Change Energy also offer competitive rates starting at 6.7 ¢/kWh. These are average prices based on 1000 kWh a month.
The cheapest basic fixed electricity rate in Dallas as of September 9, 2026 is 12.2 ¢/kWh with APG&E Electricity Plans 10. Other providers like Champion Energy Services also offer competitive basic fixed rates starting at 12.3 ¢/kWh. These are average prices based on 1000 kWh a month.
Compare Electricity Rates Near You
Sources:
- Based on evaluation of the lowest 5 basic fixed rate plans on PowertoChoose.org from June 3 vs. August 3, 2026 ↩︎
