TDSP vs TDU: Understanding Electricity Delivery in Texas

In Texas, your electricity bill includes two separate components: the supply charge from your retail electric provider (REP) and delivery charges from your local utility. These utilities are called either a TDSP (Transmission and Distribution Service Provider) or TDU (Transmission and Distribution Utility). The terms are often used interchangeably.

Your TDSP owns and maintains the physical infrastructure — the poles, wires, and transformers that carry electricity to your home. No matter which REP you choose, your TDSP remains the same based on your location.

Texas has four main TDSPs serving deregulated areas. Oncor serves the Dallas-Fort Worth metroplex and much of West Texas. CenterPoint Energy serves Houston and surrounding areas. AEP Texas serves South Texas and the Coastal Bend region. TNMP (Texas-New Mexico Power) serves smaller communities across North and West Texas.

Delivery charges typically appear as a fixed monthly customer charge plus a per-kilowatt-hour energy charge and vary by TDSP. These charges are regulated by the Public Utility Commission of Texas and are identical regardless of which REP you choose.

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