When you compare energy plans in Texas, it’s important to know the key differences between two common types of electricity plans: fixed-rate and variable-rate. Each type of plan has its own set of advantages. Understanding them can help you make an informed decision about the best electricity plans for your needs and budget.

What is a fixed-rate electricity plan?

A fixed-rate electricity plan gives you a stable electricity rate for the length of your contract. Term lengths often range from 6-24 months with 12 months being a very common term length.  

Key features of fixed-rate energy plans

Rate Stability: No matter how the energy market fluctuates, your price per kWh remains constant for the contracted period (unless there are changes in Transmission and Distribution fees or other matters/fees beyond your retail electric providers control). This stability means more predictability and fewer surprises. You can budget better and not have to worry about sudden price increases.

Contract Length: To get the benefit of a predictable, fixed rate, you usually need to sign a contract for a specific period of time. This can be a positive if you prefer long-term stability. But it might not be as appealing if you want more flexibility or if you’re unsure about your long-term plans because fixed-rate energy plans sometimes have early cancellation fees if you want to switch providers before your contract has expired.

Price Comparison: Fixed-rate plans make it easier to compare energy plans and prices since the rate is steady. This helps you assess and choose the cheapest electricity plan for your lifestyle and needs over a set period of time.

What is a variable-rate electricity plan?

A variable-rate electricity plan is also known as a month-to-month plan. This type of plan gives you electricity rates that can vary from month to month without requiring a long-term commitment.

Key features of variable-rate energy plans

Flexibility: Compared to fixed-rate plans, variable-rate energy plans give you more flexibility. It’s easier to switch to another provider or plan. This is because there are usually no long-term contracts or cancellation fees. This can be a positive if you think there may be changes in your electricity usage or if you want to keep your options open.

Market Dependence: Variable-rate plans are directly influenced by market conditions. The rates can go up or down based on demand, fuel costs, weather, and other factors. Sometimes, this can result in lower rates than a fixed-rate plan offers.

Cost Variability: Variable rates mean less predictability in your monthly electricity bill because the rate can change every month. The fluctuating pricing structure also makes it more difficult to compare electricity rates. Plus, it can make budgeting trickier since you would need to monitor your electricity usage and market trends.

Which type of electricity plan gives me the lowest electricity rates?

As you have seen, both fixed-rate and variable-rate plans have their pros and cons. You can find low electricity rates with both types of plans, but don’t leave it up to luck. Compare energy plans and providers to see which will fit your home, lifestyle, budget, usage habits and preferences the best.

(And don’t forget to factor in any additional perks that may be offered with certain plans or providers.)

Compare energy plans to find the best electricity rates for you

Whether you’re looking for the rate stability of a fixed-rate plan or the flexibility of a variable-rate plan, Everything Energy has you covered.

Use our free search tools to view and compare energy plans from electricity companies in Texas you can trust. Filter by your average monthly usage, term length preference and more. Then, sign up when you find the perfect fit.

Ready to shop? Start here!

Average Electricity Costs? Try Energy-Saving Tips – everything energy

At Everything Energy, we love us some good energy-saving tips. That’s especially true during the hot Texas summers. Check out these five cheapest energy hacks to help you use your air conditioner a little less and beat the heat. (And trim some dollars off your next electric bill.)

Cheap Energy Hack #1: Maximize your thermostat settings

Going for a cheaper energy bill? Start with your thermostat. If you have a programmable or smart thermostat, set it according to your household’s schedule. When you’re home, run it at a comfortable temperature. When you’re sleeping, kick the setting up a few degrees. And when you’re not home, bump it up even further, or turn it off completely. (Unless you have pets that may need you to maintain a comfortable temperature while you’re away.)

Increasing the temperature setting in summer, even by a degree or two, can make a big impact on your monthly bill.

Cheap Electricity Hack #2: Seal air leaks to keep cool air inside

It doesn’t make sense to run your AC all day if it’s just seeping out of your home left and right. If you own your home, seal up those leaks with caulk or weatherstripping. And if you rent, ask your landlord to take care of the issue. It’s essential to keep the cool air in and the hot air out to avoid waste.

This is another way to achieve cheaper electricity bills in summer.

Cheap Energy Hack #3: Avoid adding more heat

When you’re going for the cheapest energy bill in summer, the last thing you want to do is add more heat to your home. For this reason, avoid using your clothes dryer, dishwasher and oven/stove during the day. Instead, try to run loads of dishes at night, hang clothes to dry and grill outdoors or have a chilled meal.

Cheap Energy Hack #4: Eat to hydrate

About 20% of the water our bodies need comes from the foods we eat. For optimal hydration, which will help you regulate your body temperature, eat foods that contain a lot of water. The following foods contain 92% or more water content: cucumbers, iceberg lettuce, celery, radishes, tomatoes, bell peppers, spinach, strawberries and watermelon.

Cheap Electricity Hack #5: Get creative at night

Falling asleep in hot weather can be tricky and just plain uncomfortable. Instead of running your air conditioner all night — running up your bill — open your windows and try some other ways to beat the heat:

• Stick a clean pair of socks in the freezer an hour before you go to bed. Then, put them on as you hop in bed for a refreshing cool-down. This also works with your pillowcases or even your sheets.
• Use an ice cube or cold water on pulse points to cool off.
• If your bedroom is upstairs, camp out on a lower level. Heat rises, so a room closer to the ground should be cooler and more comfortable.
• Store lotions and face sprays in the refrigerator for a cooling bedtime skincare routine.
• Take a cold shower right before bed.
• Sleep in lightweight, breathable, loose-fitting pajamas.

Avoiding summer spikes starts with getting the cheapest electricity rates.

You can cut back and optimize your air conditioner usage to your heart’s content. But at the end of the day, you’ll still be using some electricity every month. That’s where finding the best energy prices for your home and lifestyle comes in.

In your search for the best electricity prices, be sure you’re making apples-to-apples comparisons. One easy way to do so is to use Everything Energy’s advanced filtering tools. We help you look beyond the price per kilowatt hour and show you plans based on your specific needs and usage habits. You can even see customized bill estimates! That way, you can be confident you’re making a smart energy choice.

Shopping for electricity has never been so easy!