2 minute read • Graham Lumley • Last update February 2024
These charges pay for the delivery or passthrough of electricity from the generation source (power plant) to your home. For example, they would cover the management and maintenance of powerlines, switchgears, and transformers.
TDU (Transmission and Distribution Utility) Pass-Through Charges are set by your regional utility company and approved by the Public Utility Commission of Texas (PUCT).
Retail electricity providers (REPs) receive none of the money from these charges as they are passed directly to the utility company.
The Energy Charge is directly tied to how much electricity you use at home during a billing period. It can be calculated as your total kWh usage times the energy charge rate. The more electricity you use, the higher your bill and vice versa.
The energy charge is what you pay to your REP.
The Miscellaneous Gross Receipts Tax Reimbursement (MGRT) is another charge that goes straight to your regional utility company.
This is a tax that utility companies must pay if they are doing business within an incorporated city or town with a population of 1000 people or more, per the last federal census.
You can learn more about the MGRT on the Texas Comptroller website.
This charge is passed directly to the Public Utility Commission of Texas (PUCT). Your REP does not receive any of this money.
The PUC Assessment is a fee assessed to recover the statutory fee for administering the Public Utility Regulatory Act.
Sales Tax is added to your bill in the same way that you must pay sales tax when making a purchase at a restaurant, gas station, or clothing store. This tax is imposed by the state of Texas.
Many Texas retail electricity providers include monthly base charges on bills up to $9.95. This is supposed meant to cover administrative costs. We believe they are unnecessary charge that exist to increase your bill, so we do not include them in our plans.
Some energy companies will tack on an additional charge if you consume “too little” or “too much” energy. These charges can add another $9.95 onto your bill. While it’s our goal to help you use the least amount electricity possible to keep your bills lower, we do not believe there is a correct amount of energy. You will not find usage fees, limits, or requirements in our Electricity Facts Labels.
