Understanding the Different Types of Electricity Plans & What They Mean

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Electricity plans in Texas can look similar at first glance, but the fine print can make a big difference in what you actually pay. Fixed, variable, and time of use plans each work differently. NextVolt Energy believes the best plan is one you can understand, trust, and budget around without surprises.

Picking an Electricity Plan That Truly Fits

Electricity choice should be simple. Unfortunately, many plans are filled with marketing tactics that make them sound better than they are. Whether it is “off-peak savings” or “bill credits,” too many plans hide complexity behind catchy names. At NextVolt Energy, we believe your plan should work for you, not the other way around. Here is what to know before you enroll.

Fixed Rate Plans: Predictability Over Gimmicks

A fixed rate plan keeps the price per kilowatt hour the same throughout the contract term. It is straightforward and helps you plan your monthly budget. You know what you will pay for energy, regardless of market spikes or seasonal swings.

Beware of “Bill Credit” and “Bullseye” Plans

Some providers use variations of fixed rate plans called “bill credit” or “bullseye” plans. These plans give you a bill credit if your monthly usage lands inside a specific range, such as between 1,000 and 1,200 kilowatt hours. Fall outside that range, and the credit disappears, often making your effective rate much higher.

This lets providers advertise a lower “average” rate that only applies if you hit the usage target. Most customers do not use the same amount of power every month, so these plans rarely deliver the advertised savings. They also make it harder to compare plans side by side because the real rate changes depending on your usage.

NextVolt believes in clear, honest pricing with no usage traps or hidden thresholds. A true fixed rate plan should mean your price is fixed. It’s as simple as that.

Variable Rate Plans: Flexibility With Risk

Variable rate plans change month to month based on market conditions. When energy prices drop, your rate might go down. When demand or fuel costs rise, your rate increases too. These plans may work for short-term renters or customers who watch the market closely and can handle monthly bill changes.

If you prefer certainty, a variable plan is not the right fit. Texas weather and demand can change quickly, leading to sudden increases. A fixed plan keeps you protected from those fluctuations.

Time of Use Plans: The Myth of “Off-Peak Savings”

Time of use plans charge different prices depending on when you use electricity. Peak hours (usually afternoon and early evening) cost more. Off-peak hours (typically overnight) are marketed as cheaper times to run appliances and charge devices.

On paper, this sounds like a way to save. In reality, many providers quietly raise their rate during off-peak hours, which can offset any savings you might expect. Unless your home’s energy use lines up perfectly with their discounted hours, you could end up paying more overall.

Time of use plans also require constant attention to schedules, making them inconvenient for most families. That is why NextVolt Energy generally does not recommend them. A stable, fixed rate plan gives you fairness and peace of mind without playing a guessing game about when to use power.

Why Knowing Your Own Usage Matters

No two homes use electricity the same way. The best plan for you depends on how much energy you use and when you use it. Knowing your average monthly and seasonal usage helps you compare plans accurately and avoid pitfalls like “bullseye” credits or seasonal rate spikes.

To find your usage:

  • Review your past 12 months of bills.
  • Look for the kilowatt hours (kWh) used each month.
  • Notice patterns—does your usage jump in summer or winter?
  • Use this data to compare plans at the usage level closest to your home’s average.

A good provider will help you understand your usage, not take advantage of it. At NextVolt Energy, we want customers to choose confidently and know what to expect all year long.

Questions to Ask Before You Enroll

  • What is the “all-in” average kWh rate, including energy charge, base charges and delivery fees?
  • Does the plan include credits, thresholds, or minimum usage rules?
  • What happens when the contract ends?
  • Are there early termination fees?
  • Who do I contact for outages or billing questions?

If you cannot get a clear answer to any of these questions, it is a red flag.

NextVolt’s View: Simplicity and Trust Win Every Time

Electricity is a necessity, not a guessing game. Our goal is to make it simple for you to understand your plan, your rate, and your bill. We believe in fixed rate plans that are transparent, fair, and easy to manage. No gimmicks, no traps. Just power you can count on.

When you are ready to take the confusion out of your electricity choice, NextVolt Energy is here to help you make the clear, confident choice that fits your life.

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