Renewing Electricity Plans in Texas: Complete Guide

KEY TAKEAWAYS

Your provider will notify you 30-90 days before your contract ends
Most providers increase pricing at renewal, it’s almost always best to shop around (this is not the case at BKV Energy – we don’t markup renewals)
If you don’t select a plan, you will be moved automatically to an expensive default month-to-month plan with a variable rate
If you switch providers in the last 14 days of your plan, you will not need to pay an early termination fee

What to do when your contract ends

In Texas’s deregulated electricity market, your retail electricity provider (REP) must notify you before your fixed-rate contract ends.

When you’re eligible to renew your electricity plan, you have three choices:

Renew with your current provider
Switch to a new provider and a new plan
Do nothing and default to a month-to-month variable rate plan

This guide walks you through how the Texas electricity plan renewal process works, what the law requires providers to tell you (and when), and best practices for finding a good electricity plan.

How electricity contract renewals work in Texas

Texas is one of the largest deregulated energy markets in the country. Instead of one utility controlling everything, a Transmission and Distribution Utility (TDU) delivers power over the wires, while REPs compete to sell you the electricity itself.

This competition is why you get to choose a plan and contract term, and why when your contract nears its end you get to select a renewal or shop for a new plan with a different provider.

Most fixed-rate electricity plans come with term lengths ranging from 3 to 36 months, with 12 months generally being the most common choice.

In the last 90 days of your contract, your provider is required to begin notifying you that your contract is nearing its end and that you are eligible for renewal. As mentioned before, you can choose between three options:

Renew with your current provider: Select a new plan with your current provider. There’s no break in service. Your provider will manage everything once you’ve made a selection.
Switch to a new provider: You can choose a new provider entirely, ending your relationship with your current REP. The new provider manages the switch on your behalf. You may be subject to an early termination fee if you switch providers before the last 14 days of your current contract.
Do nothing: Your contract expires and your current electricity provider is legally required to automatically place you on their default month-to-month variable rate plan.

If you choose to switch to a new provider and make the switch too soon, you may be required to pay an early termination fee. Switch in the last 14 days of your contract to avoid the penalty.

If you do nothing, your service will be switched to a month-to-month plan with a variable rate. These plans cost more and can lead to very expensive electricity bills.

What happens if you don’t renew or switch

If your electricity plan ends and you have not chosen a new plan, PUCT rules require that your provider continues your service.

If you don’t renew or switch, you won’t be disconnected, but your service will be defaulted to a month-to-month renewal plan.

There are a few things you should know about default month-to-month plans:

Default month-to-month plans have variable rates, meaning the price can change from month to month based on changes to the market
Default plans are usually more expensive than fixed-rate plans
Default renewal products have no early termination fee, you can select a new plan with your current provider or switch providers at any time without penalty

These plans are designed to keep your lights on, but they are not affordable.

If you land on a default month-to-month plan with a variable rate, it is recommended to switch to a fixed-rate plan as soon as you can.

Renewal prices vs new-customer prices

Most electricity providers don’t offer their existing customer their best rates.

Many Texans are caught off guard when their electricity provider offers renewal plans that are significantly more expensive than the original contract, and more expensive than the new-customer rates.

Unfortunately, this gap in pricing between renewing customers and new customers is all too common.

One of two things generally happens next:

You notice the plan is more expensive and start looking for a new provider and a new plan
You don’t notice the plan is more expensive, and then you’re stuck with bills that are higher than you’re used to

At BKV Energy, we do not markup renewal pricing. Renewing and new customers receive the same rates. However, this excludes our default month-to-month renewal product; we encourage our customers to actively select a renewal offer in order to secure a low fixed rate.

When is the best time to renew your electricity plan?

Electricity rates in Texas typically fluctuate with seasonal changes in grid demand tied to heating and air conditioning usage.

Those trends lead to a few rules of thumb:

Spring and fall are typically the best time to renew an electricity contract because grid demand is lower
Summer and winter tend to push rates higher, avoid renewing here if you can
Picking a contract length that sets you up for a spring or fall renewal can help you save big in the long run

It’s worth noting that these seasonal pricing trends are not a guarantee, as the Texas wholesale electricity market is influenced by many factors.

How to avoid an early termination fee if you decide to switch providers at renewal

The PUCT requires that the final 14 days of an electricity plan are penalty-free for Texans that would like to switch providers.

That means if you choose not to renew with your current provider, the best option is generally to wait until that 14-day window where you will not be subjected to an early termination fee.

Alternatively, you can use our custom Should Your Switch Electricity Providers? calculator to see if paying the early termination fee is worth it.

Should you stay with your current provider or switch?

In most cases, switching to a new provider saves money because providers often jack up the rates at renewal. If your provider offers the same prices to new and existing customers, there’s a good chance that sticking around is worth it.

Stay with your provider if…	Switch providers if…
Your renewal offers are competitive with current market rates	The renewal offer is more than new-customer rates
You want to keep your rewards or benefits	You’ve been unhappy with customer service quality
You value the relationship with your provider	You’re looking for new rewards or benefits your provider doesn’t offer

What your electricity provider is required to tell you at renewal

The Public Utility Commission of Texas (PUCT) regulates the renewal process in section “(e) Contract expiration and renewal offers” of Chapter 25 Subchapter R of the Substantive Rules Applicable to Electric Service Providers.

In this section, the PUCT requires that:

REPs send at least three written notices of the date a fixed rate product will expire
REPs must send notices by mail unless the customer has opted to receive communications electronically
If a REP does not provide notice and a customer does not select a new plan, the REP must continue serving the customer under the terms of the original product until the REP provides notice or the customer selects another plan

Rules around written notices vary slightly by the length of the electricity plan:

For plans 12 months or longer, your first expiration notice may be delivered 3 months before the contract end date
For plans 4 months or longer, the final expiration notice must be provided at least 30 days before the contract expires
For plans fewer than 4 months, the final expiration notice must be provided at least 15 days before the contract expires

The rules also stipulate that if you do not choose an electricity plan after receiving your contract expiration notices, the REP is required to continue providing your electricity with a default month-to-month plan with no early termination fee.

The PUCT also specifies the information that is required on an expiration notice:

The date the contract will expire in bold-faced and underlined text
A note that clarifies no early termination fee will apply in the final 14 days leading up to the expiration date
Details on the renewal offers that are available to you
A statement clarifying that if you do not select a plan, your service will default to a month-to-month plan that can be cancelled anytime with no early termination fee

Electricity renewal checklist

Find your contract end date
Add a reminder to your calendar to start checking renewal options 60-90 days out from the end of your plan.
Use your historical kWh usage and renewal offer EFLs to estimate electricity bills
Decide: renew, switch, or default to month-to-month
Lock in your decision during the 14-day penalty-free window

Frequently asked questions

How do I know when my electricity contract expires in Texas?

Check your monthly bill for your contract end date, find your contract end date in your customer portal account online, or call/email your provider directly to confirm the end date.

Will my power be shut off if I don’t select a renewal plan?

No. Public Utility Commission of Texas rules require that your provider continue to provide electricity service by automatically moving you to a default month-to-month plan. Your power will stay on, but the rate per kWh is likely to variable and more expensive until you actively choose a new plan.

Is my renewal rate the same as a new customer?

Not necessarily, and often not. Many providers offer “teaser rates” to attract new customers, then up the pricing at renewal. At BKV Energy, we operate differently and offer new and returning customers the exact same rates (this does not apply to the default month-to-month plan).

When is the best time to renew an electricity contract in Texas?

Spring and fall are generally the best time of year to renew because lower demand on the grid often drives lower, more competitive pricing. If your contract is set to expire during summer or winter, consider a shorter plan to shift your renewal window to a more affordable season.

Can I switch providers without penalty when my contract ends?

Yes. If you switch providers within the final 14 days of your plan, you will not be subject to an early termination fee. There is also no early termination fee if you’ve been defaulted to a month-to-month plan with a variable rate.

Can I take my service with me if I’m moving to a new home?

Yes. If you are moving to an area that your provider can provide service, they can transfer your electricity service to your new home.

Written by Graham Lumley

Graham Lumley, Growth Product Manager at BKV Energy, leads digital and traditional marketing strategies, focusing on educating Texans about the state's deregulated energy market. With over 10 years of marketing experience, he creates content to help consumers understand and save on their energy bills, bringing a fresh and dynamic approach to the industry.