The basic formula
Monthly bill = kWh used x average price per kWh, plus taxes and any charge the label says is outside the average. That works because the average price on an Electricity Facts Label is defined by the rule to include all recurring charges. The label's average price is the total average price for electric service reflecting all recurring charges, excluding state and local sales taxes and the state gross receipts tax reimbursement, rounded to a tenth of a cent. See PUCT rule 25.475.
Recurring delivery charges are part of the recurring charges behind that average, so you do not add a separate delivery charge on top of it. Charges the label lists as outside the average, such as a special charge for underground service, are the exception. (If you want to see the delivery part alone, the TDU guide has the regulated figures.)
Step 1: know your kWh
Your bill shows kWh used for the billing period. A single month misleads in Texas because cooling drives summer use. Look at twelve months, or at least a summer month and a winter month. For context, the EIA reports that the average Texas residential customer used about 1,110 kWh a month in 2025 at an average price of 15.4 cents per kWh, an average monthly bill of $170.95 (the Texas state page shows the figures and their source). Those are statewide averages; yours can be far from them.
Step 2: pick the right price
The label gives average prices at 500, 1,000 and 2,000 kWh. Average price falls or rises with use because fixed monthly charges are spread over more kWh. Take the price for the level closest to your usage. If you fall between two levels, use the lower and higher price to bound the bill.
Step 3: a worked example
The numbers below are made up for the arithmetic and are not any real plan. Suppose a label shows average prices of 17.5 cents at 500 kWh, 13.0 cents at 1,000 kWh and 12.1 cents at 2,000 kWh.
| Monthly use | Average price | Estimated bill before taxes |
|---|---|---|
| 500 kWh | 17.5 cents | $87.50 |
| 1,000 kWh | 13.0 cents | $130.00 |
| 2,000 kWh | 12.1 cents | $242.00 |
At 500 kWh the bill is 500 x $0.175 = $87.50. At 1,000 kWh it is $130.00. At 2,000 kWh it is $242.00. Notice the per-kWh price fell 5.4 cents between the first and last row, yet the bill rose every time. A lower average price at higher use is not a cheaper bill. Compare dollars, not cents.
For 1,400 kWh, which lies between two points, a reasonable estimate is to draw a straight line between the 1,000 and 2,000 kWh average prices. The price at 1,400 is 13.0 - (0.4 x 0.9) = 12.64 cents, so the estimate is 1,400 x $0.1264 = $176.96. That is an approximation; the provider does not publish a price for that level, so treat it as a guide and not as a quote. The plan workbook does this calculation for hundreds of plans at once.
Step 4: add what the average leaves out
- Sales tax and the gross receipts reimbursement. The rule excludes them from the average price, so add them if your bill shows them.
- Special charges. The label must say if some customers pay a charge, such as for underground service in part of a delivery area, that is not in the average.
- Credits and fees tied to usage. If the plan has a bill credit above a usage level, the average price already reflects it at the three label points, but a month at a different usage can behave differently.
Step 5: check the estimate against your bill
Take a past bill. Multiply its kWh by the average price on your plan's label at the nearest usage level. If the result is more than a few dollars below the amount on the bill, look for taxes, a charge listed as outside the average, or a plan change. If it is above, a usage credit may have applied. A reliable estimate matches a past bill before you use it to compare a new plan.
Comparing two plans
Estimate each plan's bill at your 500, 1,000 and 2,000 kWh points or at the point nearest your usage, in dollars. Then add the cost of leaving: the label states the termination fee. A plan that saves $4 a month but carries a $150 fee takes more than three years to repay if you leave early. Also check the term and what happens at expiration, covered in the plan types guide.
Why is my real bill different from my estimate?
Weather changes usage, the label price is an average and not a quote, and taxes and special charges sit outside it. A wrong usage figure is the most common cause, so use real bill kWh.
Should I use the state average of 1,110 kWh?
Only as a starting point. Your own bills are the right input.
This page is general information, not advice for your situation. Example prices in this guide are invented for the arithmetic.