Texas Utility Companies

Transmission and Distribution (TDU), also known as Transmission/Distribution Service Providers (TDSP), delivery charges cover the cost of maintaining the poles and wires that deliver electricity to your home and the meters that measure it. 

Electricity providers purchase electricity wholesale and sell it to you at retail as bill you for your energy usage each billing cycle.

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TDU delivery rates are regulated by the Public Utility Commission of Texas (PUCT) and must be approved before you see them on your bill.

You’ll find these delivery rates included in your monthly electricity bill, which cannot be marked up by your retail electric provider (REP).

TDU delivery charges will show up on your bill in two ways.

If you have a “bundled” electricity plan, your REP will include the TDU delivery charges in the energy charge on your bill.

If you have an “unbundled” electricity plan, you should see separate lines on your bill for those TDU charges.

Fixed-rate electricity plans are great because they let you lock in your electricity rate, regardless of any changes in the overall electricity market.

The rate your provider charges won’t change, but the TDU that delivers your electricity can change delivery charges twice a year with regulatory approval.

Most of the time, you’ll find a section on your electricity facts label (EFL) or in Terms of Service that says something like the following:

“Your price can change to reflect changes in TDU charges, changes to the ERCOT or Texas Regional Entity administrative fees charged to loads or changes resulting from federal, state, or local laws that impose new or modified fees or costs”

Simply put, the TDU can change the delivery fees to recover their costs, and that will make your bill go up a small amount.

The rate you are paying your provider for electricity will not change.

TDUs can update and change delivery fees twice a year on March 1 and September 1.

Any changes in the delivery charges must be approved by the Public Utility Commission of Texas (PUCT).

If you notice a change on your bill, contact your REP for the details of any delivery charge changes.

TDUs provide a critical public service and are entitled to collect 100% of their costs from consumers.

If something changes that cost the TDUs money to continue supplying electricity, say a winter storm comes through and wreaks havoc on power lines and transformers, the TDU can raise delivery charges to cover the cost of repairs.

Any time the TDUs want to raise their delivery charges, the changes have to be approved by the PUCT before the changes show up on your bill.