Which parts of Texas are deregulated (and which aren't)?

Can you choose your electricity provider in Texas?

Most Texans can. About 85% of the state's power customers live in areas with retail choice, where you pick the company that sells your electricity. The big exceptions are Austin, San Antonio, El Paso, other cities with their own municipal utility, and areas served by electric cooperatives. In those places, one local utility handles everything and there are no plans to compare.

What decides it isn't your city limits or your county line. It's which company owns the wires that reach your meter. Retail choice applies where one of six competitive transmission and distribution utilities, or TDUs — the regulated companies that own the poles, wires, and meters — delivers the power, all of them on the ERCOT grid. If your delivery company is a city-owned utility, a co-op, or a utility outside ERCOT, choice doesn't apply, no matter how close you live to a place where it does. How the deregulated market works covers what that split of roles means; this guide covers where it applies.

Which parts of Texas have electricity choice?

The areas served by six competitive delivery utilities: Oncor, CenterPoint, AEP Texas Central, AEP Texas North, Texas-New Mexico Power, and Lubbock Power & Light (since 2024). Together they cover most of the state's population, including nearly every major metro except Austin, San Antonio, and El Paso.

If you live in Houston, Dallas, Fort Worth, Corpus Christi, or the suburbs around them, you're in a choice area and you pick your provider. The delivery side stays regulated even here: your TDU's rates are set by the Public Utility Commission of Texas, or PUCT (the state's utility regulator), and delivery costs the same no matter which provider you pick. What you're choosing is the retail layer: the contract, its price, and its features.

Which areas are not deregulated, and why?

Three kinds of places sit outside the competitive market: cities with municipal utilities, territories served by electric cooperatives, and the parts of Texas that aren't on the ERCOT grid at all.

The carve-outs reflect how these utilities are owned and governed. The 1999 restructuring law required competition only from investor-owned utilities inside ERCOT. Municipal utilities are owned by the city's residents and answer to elected officials; co-ops are owned by their members and answer to a member-elected board. Since those customers already own their utility, the Legislature let each community decide for itself whether to open to competition. Almost none have opted in.

The non-ERCOT regions are a different story. El Paso, the upper Panhandle, and parts of far East Texas sit on grids that span other states and fall under federal oversight, so the single-state market Texas built doesn't reach them. The law contemplated choice there too, but it was never implemented. Those utilities still use the traditional regulated structure: one company generates or buys the power, delivers it, and bills you at rates set through PUCT rate cases.

What happened when Lubbock joined the market?

Lubbock is the one city that has opted in, making it both the newest choice area and the best illustration of why the map almost never changes. Facing an expiring wholesale power contract, Lubbock Power & Light concluded that joining ERCOT was cheaper than signing a new long-term deal, and once on the ERCOT grid, the city council voted to open its retail market too.

Note what LP&L kept: the wires. It stopped selling electricity but still delivers it, exactly like Oncor or CenterPoint in their territories, as a municipal utility acting as a competitive TDU. For roughly 100,000 households, the change meant choosing a provider for the first time, with designated default providers as the safety net for anyone who didn't.

What if you can't choose your provider?

Then there's nothing to compare, and no other company can sell you electricity at your address. Your rate is still overseen: municipal rates are approved by the city council or utility board, co-op rates by a board the members elect, and non-ERCOT utility rates by the PUCT in public rate cases. Municipal utilities answer to voters, and co-op members can vote in board elections.

What you control is the other side of the bill: usage. Most municipal utilities and co-ops run efficiency rebate programs, and many offer time-of-use or solar options of their own. Those programs and your energy use are the main ways to manage costs in a non-choice area.

One caution: because no provider can compete at your address, anyone at your door in San Antonio or a co-op territory offering "a better electricity rate" is selling something else, often a solar lease or a contract that doesn't apply to your home. In a non-choice area, the only company that can bill you for electricity is your utility.

How do you check your specific address?

Your ZIP code is the quick check: enter it in the Texas electricity setup guide, and it shows the likely delivery utility and whether that area has retail choice. A handful of ZIP codes straddle a boundary, with a TDU on one side of the road and a co-op on the other, so for a specific address use the Texas ESI ID lookup — it returns the delivery utility for that service point. The definitive answer is still who delivers your power.

You can also tell from your bill. If it comes from a retail provider and includes a delivery or TDU line, you're in a choice area. If it comes directly from Austin Energy, CPS Energy, a co-op, or a utility like El Paso Electric or Entergy, that company is both your delivery utility and your electricity seller.

Deregulated areas of Texas FAQ

Is Austin deregulated?

No. Austin is served by Austin Energy, a municipal utility owned by the city, which generates or buys the power, delivers it, and bills you at rates the city council approves. Austin residents can't switch providers, but they can use Austin Energy's rebate, solar, and time-of-use programs.

Does San Antonio have electricity choice?

No. San Antonio is served by CPS Energy, the largest municipal utility in the country, which handles everything from power supply to billing at board-approved rates. Anyone offering San Antonio residents a cheaper electricity plan is selling something other than retail electricity.

Can you choose your electricity provider in Houston or Dallas?

Yes. Houston (delivered by CenterPoint) and Dallas–Fort Worth (delivered by Oncor) are the two biggest deregulated areas in Texas. Residents pick their retail provider, and the delivery utility stays the same regardless of the choice.

Is Lubbock deregulated now?

Yes. Lubbock opened to retail choice in January 2024 after Lubbock Power & Light joined the ERCOT grid. LP&L still owns and maintains the wires, but Lubbock residents now choose the provider that sells them electricity, like the rest of the competitive market.

Can you choose your electricity provider in El Paso?

No. El Paso sits outside the ERCOT grid and is served by El Paso Electric, a regulated utility that generates, delivers, and sells power at rates set through PUCT rate cases. The same is true of the Panhandle (Xcel Energy) and parts of East Texas (SWEPCO and Entergy Texas).

Can you leave an electric co-op and pick a provider?

Generally no. A cooperative's territory opens to competition only if its member-elected board opts in, and almost none have. Your leverage is as a member-owner: co-ops hold board elections and return excess revenue to members as capital credits.

Sources and related reading

The market's boundaries come from the 1999 restructuring law, codified in Texas Utilities Code Chapter 39; Chapter 40 and Chapter 41 give municipal utilities and cooperatives the choice to opt in. ERCOT's announcement covers Lubbock's move to the grid, and the PUCT's consumer pages explain retail choice eligibility.

Reviewed July 15, 2026. This guide provides general educational information, not legal advice. Rules and plan terms can change; confirm current PUCT materials and your plan documents for your situation.

Continue with how the deregulated market works, TDU delivery charges explained, or how to read an Electricity Facts Label.