What is CenterPoint Energy?

What does CenterPoint do?

CenterPoint Energy is an electric utility company and natural gas distributor operating in Texas, Louisiana, Arkansas, Oklahoma, Mississippi, Minnesota, and Indiana, offering essential services to residential and commercial customers. Services offered vary by location.

Natural gas distribution

CenterPoint Energy, unlike a natural gas production company, doesn’t drill or extract natural gas. Instead, it plays a critical role in natural gas service transmission and distribution. It maintains a vast network of pipelines to ensure the reliable delivery of gas to homes that use it for heating, cooking, and fueling appliances.

What is CenterPoint Energy’s natural gas customer base? It serves around 4 million customers across Indiana, Minnesota, Mississippi, Louisiana, Ohio, and east Texas—predominantly in the greater Houston area.

Electricity distribution

Is CenterPoint Energy a gas or electric service provider? It’s both. Besides natural gas, CenterPoint in Houston and its surrounding service areas plays a critical role in retail electric distribution. The company is responsible for maintaining the electric infrastructure, ensuring reliable service even during peak demand times by managing poles, wires, and other infrastructure, and addressing downed power lines following power outages after storms.

What is CenterPoint Energy’s electricity customer base? About 2.5 million customers, primarily in the Houston area, rely on CenterPoint for electricity distribution services.

Electricity production

While CenterPoint Energy primarily focuses on electricity delivery rather than production, it operates power plants in Indiana. Under Texas law, retail electric providers (REPs) cannot own power plants within the state. Therefore, although CenterPoint owns the lines that deliver power to many Texas residents, they operate purely as a Transmission and Distribution Utility (TDU).

Does CenterPoint generate electricity in Texas?

No. As previously mentioned, CenterPoint Energy only delivers electricity in Texas, a function of the state’s deregulated energy market where electricity generation is separated from distribution. Along with CenterPoint, five other transmission and distribution companies operate in Texas:

Oncor
Texas-New Mexico Power
American Electric Power (AEP) Texas Central
AEP Texas North
Lubbock Power & Light (LP&L)

How do I stop paying CenterPoint?

The reality is you can’t completely eliminate the TDSP/TDU charges involved in supplying your home with utilities like gas and electricity. They will typically appear as an item on your monthly bill under any one of the following:

TDU charges
TDU delivery charges
TDU pass-through charges

Lowering your electricity bill by reducing your transmission fees is also challenging because CenterPoint is allowed to recuperate for the full amount of its operating costs, including maintenance and repairs. So, customers can expect TDU charges to be higher during particularly harsh Texas winters when the weather is colder, wetter, or windier than usual.

The only way to avoid TDU fees altogether is to live off the grid—which, while appealing on some levels, isn’t particularly practical.

The history of CenterPoint

Now that we’ve established what CenterPoint Energy is and what it does, let’s take a more in-depth look into the company’s history and how it became such a significant player in the state’s TDU game. Here’s a quick timeline of its evolution:

1866: The Houston Gas Light Company was created. It used coal and gas to power streetlights surrounding Houston industries and homes.
1870: The Minneapolis Gas Light Company was formed in Minnesota and began providing gas utilities to businesses and homes.
1882: The Houston Electric Light and Power utility company utility started generating and selling power in the Houston area.
1990: The three companies merged under the name NorAm Energy Corp.
1999: NorAm Energy was renamed Reliant Energy.
2002: Statewide deregulation and restructuring laws kicked in, with electricity rates overseen by the Electric Reliability Council of Texas (ERCOT).
2002: The company rebranded its retail electric services as Reliant Resources. The remaining assets were rebranded as CenterPoint Energy.
2013: CenterPoint teamed up with ArcLight Capital Partners LLC, a Boston-based energy investment firm.
2018: CenterPoint and Vectren Corporation entered into a definitive merger agreement to form a delivery, infrastructure, and services company.

Today, CenterPoint Energy, headquartered in a CBD tower block in downtown Houston, employs nearly 9,000 people across its locations. This growth reflects the company’s strategic expansions and key role in shaping regional energy policies and infrastructure, directly impacting consumer experiences and economic development.

Save on electricity plans with BKVE

Understanding the roles and services of providers like CenterPoint Energy is crucial for homeowners navigating the utility market. While CenterPoint is a key player in distributing natural gas and electricity, remember you have options for your energy plans.

At BKVE, we offer a variety of energy-efficient electricity plans tailored to meet your specific needs and budget. Don’t let the complexities of the utility market leave you in the dark. Find your new plan today and take control of your energy costs!

Written by Graham Lumley

Graham Lumley, Digital Marketing Manager at BKV Energy, leads digital and traditional marketing strategies, focusing on educating Texans about the state's deregulated energy market. With over 8 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.