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What is an EFL and how can it help you compare electricity plans?

Posted on by Everything Energy

An EFL or Electricity Facts Label is a lot like the nutrition label on the back of food products at the grocery store. When you pick up a can of corn and turn it to the back, you can read about everything that the can has inside it. The EFL is the same way. It will tell you everything that is inside a particular electricity plan from a particular provider.

What is an EFL?

An Electricity Facts Label is a document that electricity providers are required to provide to the public. It helps to break down every part of a retail energy provider’s electricity plans. This way, you can make sure you understand what’s in a plan and why it matters in terms of what you’ll pay and what you get.

EFLs have standard components so that all companies offering plans provide the same information – even though it might look slightly different. This allow you to easily compare energy plans of all electricity providers. This is specifically standardized in Texas for deregulated areas by the PUCT (Public Utility Commission of Texas).

Breaking Down an EFL

At the top of the plan, you’re going to see information like the name of the REP, the name of the plan, and the date this EFL went into effect.

Price

In the Pricing Disclosure, you will see a breakdown of all the components of the Average Price. Energy charge is what the REP charges for actual electricity. You may see a base charge or usage charge, which are monthly fees from the REP. If they are included in the price of the plan, they have to be listed here. So, if you don’t see those, they don’t apply to your plan.

The pricing disclosure will also include Delivery Charges from the company that owns the poles & wires in your area. Those utilities charge their fees to the REP, who passes them to consumers each month. These fees are fixed by the PUC, and you can’t change them by looking for a different plan or REP. Delivery charges could be per month, per kWH, or both.

You’ll also see here the Average Price per kWh, listed at three usage levels. This average price factors in all the elements of price, and determines what a customer would pay per kWh at each of those usage levels. That number is an easy way to compare electricity prices across different electricity providers and plans.

On average, Texans used about 1,140 kWh per month in 2019.

Disclosure Chart

Towards the bottom of the sheet, you’re going to see information related to disclosure. It’s often in a question format, but not always. You’ll see information related to whether the plan is a fixed rate or variable and the term length, for example.

In other words, you can see whether the plan has its rate change from month to month or whether it’s always the same. You’ll also see how long your contract will go for, called the “contract term.”

There could be data about the “termination fee” if you want to quit your contract before it expires. Many providers may actually waive this fee if you show them that you’re actually moving away.

You’ll see a question related to whether your price can change during the contract period. Usually, the fact sheet will indicate that the answer is “yes,” it can change. The next line indicates why and how your price could change. Even fixed price plans can have price changes if the PUC allows the TDSP to increase their rates, which are factored into the price.

You’ll also see information about other charges, deposits and renewable content.

Summing Up

This document is a very helpful guide when comparing plans and we definitely encourage you to review while you are comparing electricity plans. By learning to read the sheet, you understand the exact rates for each type of fee and compare one plan’s rates to the rate from another plan. You’ll be able to see what their tiered plans look like and whether plan A has a lower starting rate for the first tier up to 1000 kWh than plan B. Which one is best for you will depend on how much your household actually uses, so this is important to keep in mind when you’re reading all of these different sheets. Learning to do so will greatly increase your understanding of the situation.