Texas TDU Delivery Charges – Commercial

Commercial electricity delivery rates have a significant impact on your business’s electricity bill. These rates are also known as Commercial Transmission and Distribution Utility Charges, or Texas TDU Commercial Delivery Charges.

Understanding Commercial Delivery Charges in Texas

Regardless of their name, these charges are an uncontrollable part of your commercial electricity bill. Changes in delivery rates affect every home and business in Texas. However, it is essential to stay informed about these changes to adjust your operating budget and potentially reduce your total demand.

Residential Texas TDU Delivery Charges

Current Commercial Delivery Charges in Texas

To stay up-to-date with the current TDU commercial delivery charges in Texas (as of September 1, 2023), refer to the following charts:

TX Delivery Rates – Commercial Less Than 10kW

TDU Delivery CompanyMonthly ChargeCharges per kWh
AEP TX Central$5.795.8216¢
AEP TX North$5.794.723¢

TX Delivery Rates – Commercial Greater than 10kW

TDU Delivery CompanyMonthly ChargeCharge per kWh (Usage)Charge per kW (Demand)
AEP TX Central$14.690.09580¢$11.53
AEP TX North$14.690.09580¢$10.46

Understanding Commercial TDU Delivery Charges

TDU delivery charges cover the maintenance of the poles, wires, and meters that deliver electricity to your home. These rates are regulated, and the Public Utility Commission of Texas (PUCT) approves all utility delivery rates. When reviewing your commercial electricity bill, you will find a section labeled “Delivery Charges,” which includes your delivery fees and demand charges. Your bill may contain various line items, such as Customer Charge, Metering Charge, Distribution System Charge, Transmission System Charge, Nuclear Decommissioning Charge, Transmission Cost Recovery Factor (TCRF), and Transition Charges.

Delivery Rate Changes

TDU delivery rates change twice a year, specifically on March 1 and September 1. The Public Utility Commission of Texas (PUCT) must approve these changes. Occasionally, there may be small changes to commercial delivery rates between these dates. Stay informed by checking back here for the latest rates. It is crucial to consider delivery fee changes when creating your business budget.


Factors Driving Increased Commercial Delivery Charges in Texas

Each regulated utility company is responsible for collecting 100% of their costs from ratepayers and receiving a guaranteed rate of return. They provide critical public services, including electricity delivery, infrastructure maintenance, and emergency response. The Public Utility Commission of Texas reviews and approves each utility’s rate case, which may include costs related to hurricane or storm recovery, service equipment upgrades, and financing costs for system upgrades. However, the primary driver of increased commercial delivery rates in Texas is transmission. As the state’s economy and electricity demand grow, additional generation sources, such as solar or wind power located away from population centers, require transmission lines to distribute the electricity. The Transmission Cost Recovery Factor (TCRF) allows delivery companies to recover these costs as third-party companies build and operate transmission lines.

Lowering Your Texas TDU Demand Charges

While you cannot avoid paying commercial TDU delivery charges, there are steps your company can take to reduce your demand charges. Monitoring your usage during the summer months of June, July, August, and September is crucial. ERCOT measures your demand based on usage during the grid’s peak usage levels, known as 4CP or 4 coincident peaks. Once your peak demand is established, it remains unchanged for 12 months unless a new peak is reached. Therefore, your billing is typically based on the greater of your 4CP peak demand or your current month’s peak demand. Paying attention to your usage on the hottest summer days can help lower your bill the following year.

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