How to Cancel Your Electricity Plan in Texas

Not everything is as it seems in Texas, especially when it comes to retail electricity plans. Promises of savings often sound too good to be true when electricity prices are skyrocketing.

Certain areas of Texas have a deregulated energy market, which means you have a say in where your electricity comes from. If you live in a deregulated market and are unhappy with your retail electricity provider, you have the power to cancel your electricity plan and find a better fit for your home and energy preferences. And with energy companies competing to provide the best prices and reliable service, you don’t have to be stuck with your current plan forever.

However, not all electricity plans are created equal, and canceling your contract before its end date can come with a price tag. Here’s what you need to know about canceling your energy plan in Texas.

We help you find the best electricity rates in your area

How Energy Plans Work in Texas

There are two sides to the Texas energy market: regulated and deregulated. In a regulated market, you have no choice where your energy comes from. Everyone in regulated areas, like Austin or San Antonio, gets their power from the same utility, and the electricity rates are controlled by the government.

“If you don’t like their service or if they increase their prices, you just have to accept it,” Carson Kleitona campaign manager at the Texas Public Policy Foundation, told CNET. “Cancelling your energy plan in a regulated market means you [won’t] have electricity.”

We help you find the best electricity rates in your area

In deregulated areas, such as Houston, Dallas, and Fort Worth, you can compare electricity rates and choose the energy plan that best fits your household’s electricity usage and budget. Because consumers have a choice, energy companies compete to offer lower rates or better customer service as incentives to choose their plan.

If you are not satisfied with the service, you can cancel your subscription and switch to another provider. However, if you end your contract before the end date, you will probably have to pay a so-called ‘early termination fee’.

Reasons to Cancel an Energy Contract in Texas

Deciding to cancel your Texas electricity plan can depend on a lot of factors, like finding lower prices elsewhere or having a bad customer service experience with your current provider. But before you cancel, be sure to check your electric bill label for any early termination fees.

Find a better deal

High energy bills are probably the biggest reason to look for other plans. You can find a better deal by comparing electricity rates in your area. “As electricity bills go up, people pay more attention,” Clayton said. “They pay attention to itemized receipts of what they’re actually paying and how much it’s going to cost. When it comes up in conversation with friends, you learn about other options.”

Some utility companies offer plans with certain perks, such as free nights or weekends. If you are flexible enough to shift your usage, you can save money. Other companies may offer bill credits based on how much or how little energy you use. If you look at your past bills and see a trend of usage greater than 1,000 kilowatt hours, you may find a better price on a plan that gives you bill credits. Once you find a price and provider you like, you should contact your current provider to cancel your plan and switch.

Moving to a new address

If you move to a location outside of your current provider’s service area, you can cancel your subscription without an early termination fee. “It’s important to note that your most recent electricity provider will proactively require documentation of your move,” says Katie Collins, managing editor of CNET’s energy and personal finance coverage. “You can’t just move without notifying your provider and expect them to waive the cancellation fee.”

If you move to a new address that is still within your utility’s service area, you may have to pay a fee to cancel your subscription. “Depending on your terms of service, some providers may require you to transfer your subscription to your new address,” Collins said. “If your contract is up soon, your utility may let you go without penalty.”

Early termination fees and terms and conditions vary by provider. You can find the details on your electricity label. To avoid cancellation penalties, you’ll want to be proactive in communicating with your provider, Collins said. “Most electricity providers have phone apps and chat options to help you with that.”

Dissatisfied with the service

If you’re very unhappy with the service from your current provider, it might be worth paying the early termination fee to cancel. Poor customer service, billing errors, or frequent outages are frustrating. Before you switch to another plan, it’s a good idea to read reviews of other customer experiences. Find out if other providers offer incentives that are right for you and your energy usage habits.

“It’s rare, but some providers will offer to pay your early termination fee if you switch to them,” Collins said. “But don’t take anyone’s word for it unless it’s in writing.”

How to Cancel an Energy Contract in Texas

For most energy companies in Texas, you can contact customer service through an online service form, chat, email, or phone to cancel your subscription. Expect the agent to offer you promotions or discounts as a last resort to keep your business. If the reason you are canceling is because of high rates, you can try to negotiate the price down.

“This could mean the company cancels your current plan and re-enrolls you in a new plan with a lower rate, but it could extend your agreement timeline,” Collins said. “Make sure you ask.”

Otherwise, the cancellation process is pretty straightforward. However, you may be charged an early termination fee. This type of fee is usually a flat fee (usually around $100), or you may be charged a certain amount for each month left on your contract. You should be able to find your plan’s early termination fee on the electricity label.

After canceling, you will receive a final bill from your old provider. Check that all charges are correct and that the remaining balance has been paid. To keep your lights on, you will need to sign up for a new plan with a different provider of your choice. Clayton recommends PowerToChoosea website from the Public Utility Commission of Texas that allows you to compare electricity rates so you can find a better deal.

Get help with energy suppliers in Texas

If you are experiencing problems with your current energy provider in Texas, there are several agencies you can turn to for assistance.

• Customer service at your utility company: Try contacting your electric company directly. If they can’t help you fix the problem, consider other options.
• Texas Public Utilities Commission: The PUCT mediators can provide you with resources and help you manage disputes between you and your energy company. The first step is to file a complaint on the PUCT website.
  
• Energy assistance programs: If you need help paying your utility bills, there are programs that provide financial assistance to low-income households, such as the Texas Comparative Energy Assistance Programfor example.
  
• Energy comparison websites: These websites can be useful when comparing energy plans and suppliers.Websites like PowerToChoose And SaveOnEnergy (CNET’s sister site) are just a few options to choose from.