Texas Delivery Charges: What Your TDU Adds to Every Bill
Open a typical Texas electricity bill in a competitive retail area and you will notice something that looks like two companies sharing one envelope. One set of lines covers the kilowatt-hours you bought from a retail electric provider. Another set covers delivery—the poles, wires, meters, and outage crews that move those kilowatt-hours to your address. That second pile is what Texas calls transmission and distribution utility, or TDU, delivery charges. Understanding them is one of the highest-leverage habits a shopper, renter, homeowner, or small-business owner can build, because delivery follows your address, not your favorite logo.
Delivery is not a tip, not a mystery fee, and not something a clever rate plan can erase. The ¹ that investor-owned TDUs charge retail electric providers (REPs), and those providers pass the charges through on your bill. Switch the REP as often as you like; the wires company stays put. That split is the core design of Texas retail competition, and it is the reason a “cheap energy rate” can still produce a stubbornly expensive total.
Two companies, one bill: what delivery charges actually are
In competitive parts of Texas, the company that markets electricity is not the company that owns the local wires. ² puts the jobs in plain English: retail electric providers buy power and bill customers, while transmission and distribution service providers—also called TDUs or TDSPs—deliver and meter electricity, maintain lines, and restore outages. The TDSP bills the REP for delivery; the REP bundles those costs into what you pay.
The ³ uses everyday labels for the same idea. A “local wires company” delivers electricity, reads the meter, and maintains poles and wires. A retail electric provider sells electricity but does not generate it, read meters, or operate transmission or distribution wires. Transmission and distribution, the glossary adds, are regulated by the PUC to protect safety and reliability.
That bookkeeping mirrors how electricity prices are built. The ⁴ notes that retail electricity prices generally reflect the cost to build, finance, maintain, and operate power plants and the grid’s transmission and distribution lines. EIA also points out that some states fully regulate prices while others combine unregulated generation pricing with regulated transmission and distribution pricing. Texas competitive retail is the second model: you shop the energy half; regulators price the wires half.
For households, that means a summer bill spike can have two different causes. Usage may be up because the air conditioner ran hard—delivery charges rise with kilowatt-hours too, as Oncor notes when it explains that high delivery totals often track high-usage seasons. Or a tariff rider may have changed after a commission proceeding. Separating the lines helps you tell which story you are living.
Who your TDU is—and why you cannot shop it
Your TDU is determined by service address, not by which plan you clicked. ² operating in deregulated zones: Oncor Electric Delivery, CenterPoint Energy Houston Electric, Texas-New Mexico Power, and AEP Texas. The ⁵ publishes residential summaries for five reporting utilities in the ERCOT region: AEP Central, AEP North, CenterPoint, Oncor, and Texas-New Mexico Power. A September 2025 commission press release describing that page says the same five TDUs operate the poles and wires that deliver power to consumers, and that those rates form a meaningful portion of the monthly bill.
Where you live also decides whether you have retail choice at all. ⁶ explains that Senate Bill 7 (1999) separated generation, delivery, and retail functions for investor-owned utilities, with competition implemented by January 1, 2002. Municipally owned utilities and electric cooperatives may opt into competition; most have not. Customers in those non-opt-in areas—including places such as Austin and San Antonio—do not choose among retail providers. Roughly 85% of Texas electricity consumers do have that choice, covering major metros such as Dallas–Fort Worth and Houston.
Outside the ERCOT footprint, the picture changes again. The ¹ lists Entergy Texas, SWEPCO, Southwestern Public Service, and El Paso Electric as investor-owned utilities that provide both generation and delivery outside ERCOT, with retail rates set by the commission. If that is your territory, you are not shopping Power to Choose offers the way a Houston or Dallas renter does—and delivery still exists, just inside a more bundled regulated bill.
Practical takeaway: when a ZIP code sits near two wires territories, shopping tools may ask you to identify the TDU before plans populate. That dropdown is not bureaucracy for its own sake. Delivery tariffs differ, so an “average price” that ignores the wires company is comparing apples to oranges.
Anatomy of a delivery charge: fixed fees, kilowatt-hours, and riders
Delivery is a stack, not a single mystery number. On residential service, ²—notably a customer charge and a metering charge—plus variable per-kilowatt-hour items such as a distribution system charge, transmission cost recovery factor (TCRF), distribution cost recovery factor (DCRF), energy efficiency cost recovery factor (EECRF), and nuclear decommissioning charge. Oncor’s glossary defines those pieces in ordinary language: the customer charge covers customer-service expenses; metering covers meter property and reading; TCRF recovers access to and load on the ERCOT transmission system; DCRF recovers incremental distribution investment between rate cases; EECRF funds efficiency programs.
⁷ shows the same idea as a line-item menu: base customer and base meter fees, then per-kWh components including base distribution, TCRF, DCRF, EECRF, nuclear decommissioning, and assorted surcharges and refunds. CenterPoint’s broader rates page frames the household view simply: ⁸; supply charges cover the energy you use. In Houston, you choose the electricity provider; CenterPoint delivers.
Labels on the bill vary. A REP may show a single “TDU delivery” total, break out “TDSP” charges, or name the wires company. Oncor warns that REP bills may differ in how charges are displayed. Do not assume a missing acronym means a missing cost. Compare the all-in average price on the Electricity Facts Label and, when available, the published TDU summary from the commission.
Small businesses should watch demand. Oncor explains that secondary service above 10 kW can bill distribution and related charges on billing kilowatts, not just kilowatt-hours, and that demand is the highest 15-minute use in the month. Crossing that threshold can change the rate schedule for a long stretch. If you run equipment that spikes briefly—compressors, welders, multiple HVAC units starting together—delivery math can behave differently than a residential volumetric bill.
What delivery actually costs on today’s Texas bills
The PUCT now publishes a consumer-facing summary of authorized TDU rates and updates it monthly, a transparency step required after Senate Bill 1664 and described in a ⁹. As of September 1, 2026, the ⁵ shows these delivery-only snapshots (customer charge plus metering charge plus volumetric delivery, excluding the REP’s energy price):
At 1,000 kWh, average residential delivery runs about $61.07 for AEP Central, $59.93 for AEP North, $69.03 for CenterPoint, $64.36 for Oncor, and $81.87 for TNMP. At 500 kWh the same utilities land roughly in the low-to-mid $30s for most territories, with TNMP near $45. At 2,000 kWh, delivery alone climbs well above $100—about $119 for AEP Central, $117 for AEP North, $133 for CenterPoint, $125 for Oncor, and $156 for TNMP.
Those figures are not your whole bill. They are the regulated wires slice. Stack a competitive energy charge on top and you get the total that actually hits a checking account. Still, delivery with volumetric charges around five to seven cents per kilowatt-hour plus a few dollars of fixed fees is large enough that ignoring it while hunting a half-cent energy teaser is how people mis-shop.
National context helps calibrate expectations. EIA reports that in 2025 the U.S. annual average retail electricity price was about ⁴, with residential and commercial prices usually highest because distributing smaller volumes costs more than serving large industrial loads. Your Texas TDU line is one piece of that stack—not the whole number on a national average.
History also matters for expectations. A ¹⁰ on a consumer coalition analysis noted that delivery fees from major wires companies had risen faster than inflation between 2003 and 2015, becoming a steadier upward pressure on bills than the energy commodity alone. Growth, transmission buildout for renewables, and smart-meter deployment were among the industry explanations quoted then. Delivery is not static wallpaper behind your REP’s marketing.
Why delivery rates move even when your “fixed” plan does not
A fixed-rate plan is fixed for the REP’s energy price—with specific exceptions. The ³ states that a fixed rate does not change during the contract except for changes in transmission and distribution fees, changes in ERCOT or Texas Regional Entity administrative fees, or changes from federal, state, or local laws that impose fees beyond the REP’s control. In other words, “fixed” does not freeze the TDU.
Rate changes travel through commission processes. The ¹ that it sets delivery charges for TDUs inside ERCOT and allows utilities to recover the costs of providing delivery service with an opportunity for a reasonable return. TDUs must notify customers when they request a rate change, and affected customers may participate in the rate case. Between full cases, riders such as TCRF and DCRF can adjust on schedules written into tariffs—CenterPoint’s residential menu, for example, shows TCRF as a large per-kWh component alongside distribution and efficiency factors.
Infrastructure and weather drive the underlying costs. EIA lists transmission and distribution construction, operation, maintenance, storm repair, and cybersecurity among the factors embedded in electricity prices, and notes that extreme temperatures raise demand and can push prices higher. When a heat wave or freeze spikes usage, your volumetric delivery line rises even if every tariff factor is unchanged—because you used more kilowatt-hours.
Use the commission’s monthly TDU page the way you would check a mortgage index: not every week for fun, but whenever a bill jumps or a renewal letter arrives. The press release announcing the page quotes Executive Director Connie Corona on giving consumers ready access to the PUCT-approved portion of utility bills while they shop competitive plans on Power to Choose.
What shopping and switching change—and what they never will
Switching REPs changes the seller of energy, contract length, renewable content claims, billing experience, and early-termination rules. It does not change who owns the pole outside your house. ⁶ describes the handoff: you enroll with a new retail provider; ERCOT coordinates verification, notifies the TDSP, and uses a meter read so service continues while billing responsibility flips. Outages still belong to the wires company. ERCOT also notes that it tracks more than 8.5 million customer accounts across more than 170 competitive retailers, which is why switches can feel bureaucratic even when the lights stay on.
That is why comparing plans by energy charge alone is incomplete. The Electricity Facts Label exists so you can make apples-to-apples comparisons. The ¹¹ describes the EFL as similar to a nutrition label: prices, contract terms, generation sources, and related disclosures. Power to Choose’s glossary adds that every plan must have an EFL and that average prices are shown at standard usage levels so shoppers can compare.
Watch the plan features that interact with delivery rather than replacing it. Minimum-usage fees, bill credits that unlock only above a threshold, and time-of-use discounts all change your effective energy cost; none of them rewrite the TDU tariff. A low teaser at 1,000 kWh that collapses at 500 kWh is an energy-product problem, not a delivery problem—but high fixed TDU metering charges (TNMP’s metering line is a clear example on the commission table) make low-usage months less forgiving.
Consumer explainers aimed at Texas shoppers make the same point: ¹², and regulated delivery cannot be competed away by switching logos. Treat delivery as a known constant for your address, then compete hard on the half you control.
Outside ERCOT—and how choice states look similar elsewhere
If you live under a municipal utility or co-op that never opted into competition, your bill is usually a single regulated relationship. Delivery costs still exist inside the rate; they simply are not marketed as a rival brand’s line item. ERCOT notes that most municipals and cooperatives remain non-opt-in entities. Shoppers moving from Austin or San Antonio into Dallas or Houston often feel sticker shock at the sudden appearance of a TDU section—even when the physics of poles and transformers did not change.
Other U.S. choice markets rhyme with Texas even when the acronyms differ. An ¹³ lists Maryland and Ohio among states with broadly available retail customer choice for electricity in investor-owned utility territories. A ¹⁴ walks through bills that separately state distribution customer charges, delivery riders, and generation charges—and notes that the utility still delivers the commodity even when an alternative supplier provides it. EIA’s pricing primer makes the same structural point: some states leave generation pricing unregulated while keeping transmission and distribution regulated.
So whether you are renewing in Houston, comparing offers in Ohio, or reading a Maryland supplier contract, the decision rule travels: isolate delivery, then judge the supply product. Regulated markets without retail choice still deserve the same cost literacy—ask which portion of a proposed rate increase is distribution plant, which is fuel or purchased power—but you will not be picking a separate retail brand.
How to read the bill, the EFL, and the fine print before you sign
Start with last year’s bills if you have them. Seasonal Texas usage swings hard; an EFL’s 500 / 1,000 / 2,000 kWh columns exist because your average price depends on volume. Match your real average to the column that fits, then read the contract term, early-termination fee, and auto-renewal language on the Terms of Service.
Next, identify the delivery block. Look for TDU, TDSP, or the wires company name. If the bill is opaque, cross-check the ⁵ for your utility and usage band. Large mismatches deserve a call to the REP for a line-item explanation—not a panicked switch on day one.
Then separate problems by owner. Billing disputes, plan pricing, and deposit questions belong with the REP. Outages, downed lines, and meter hardware belong with the TDU. Oncor notes that TDSPs must offer the same delivery service regardless of which REP you chose. Keep both phone numbers; the wrong queue wastes hours during a storm.
Finally, treat renewal letters as a second shopping trip. Fixed plans can still pass through new TDU fees. Variable and indexed products can move energy charges monthly. The Provider of Last Resort exists as a backstop if a retailer exits, per the Power to Choose glossary, but POLR is rarely the plan you want by choice. Shop before a default renewal price becomes your new normal.
A practical checklist for households and small businesses
- Confirm whether your address is competitive retail, a municipal/co-op non-opt-in area, or a non-ERCOT bundled IOU territory—using your bill header and, in competitive areas, Power to Choose or the PUCT’s consumer materials.
- Write down your TDU name and the last twelve months of kWh. Delivery math is address-specific and usage-specific.
- Pull the current ⁵ so you know the regulated floor before you fall for an energy-only teaser.
- Compare EFLs at the usage column you actually live in, and read minimums, credits, and termination fees as carefully as the headline cent.
- For small sites near 10 kW of demand, ask whether you are on a kWh-based or demand-based secondary schedule before you add load.
- When a bill jumps, check usage first, then TDU tariff updates, then REP energy changes—three different levers, three different responses.
- If you need payment help, start with the provider on the bill; the ¹⁵ points to provider programs and state assistance pathways.
Delivery charges will not become charming. They can become legible. Once you see the wires company as a regulated roommate on every bill—present whether you renew, switch, or stay—you stop blaming the wrong half of the statement and start managing the half you can actually change.