What happens when my business electricity contract ends?
For a Texas small commercial customer on a fixed-rate contract, the provider has to send expiration notices. If you get the notice and do nothing, you move to a default month-to-month plan that you can cancel without a fee — but its price can change from one billing cycle to the next.
Check your end date, your renewal documents and your switch date before the term runs out.
First, check whether you're a "small commercial" customer
The PUCT's definition is about demand, not headcount or revenue. A small commercial customer has peak demand under 50 kW in any twelve-month period, unless its load is part of an aggregation program over 50 kW.
That's a different line from your utility's 10 kVA or 10 kW delivery threshold. You can be paying demand charges and still count as small commercial for these protections.
Larger accounts and some aggregated accounts can have different written protections. Don't assume the rules below cover those contracts — read the agreement.
The final notice has to arrive in time to act
For small commercial fixed-rate contracts, the final expiration notice must arrive at least fourteen days before the contract ends. The rule also requires at least three written notices during the last third of the contract.
Notices go by mail unless you chose electronic delivery. Check both the billing address and the inbox you use for official documents.
The notice must say when the contract ends and what happens if you do nothing. It must include the Electricity Facts Label for the default plan, or say how and when you'll get it, at least fourteen days before the end date.
The default plan and any fixed-term renewal offer are two different things. Read the EFL and the terms for each.
The last fourteen days are a fee-free window
If your contract has a calendar end date, the notice must state that no early termination penalty applies in the fourteen days before it. If the end date is tied to a meter read, the fourteen days run before the contract end date.
Confirm the exact date with your provider before setting a new start date. The day you submit an enrollment is not the day service switches.
This protection covers the termination fee. You still owe for electricity used and other proper charges.
What if no notice was sent?
If the provider fails to send the required notice and you haven't picked another plan before the end date, the provider must keep serving you on the fixed-rate contract terms until it sends the notice or you choose another plan.
Ask for the notice, its delivery record and a written explanation of any rate change. Keep your contract, bills and correspondence. Not finding a notice in your inbox is not proof the provider never sent one.
If it isn't resolved, use the provider's complaint process, and consider a complaint to the Public Utility Commission of Texas.
The month-to-month risk
When the proper final notice is sent and you take no action, the default plan is month-to-month, cancellable without a fee, and its price may change between billing cycles.
People sometimes call this "holdover." For small commercial customers, read the actual default-plan documents rather than assuming holdover means your old fixed price.
Compare the new price at your usage. Under the delivery demand threshold, compare all-in prices including energy, delivery and fees. Above it, compare energy plus delivery with demand charges marked extra. Don't compare a complete estimate against an energy-only quote.
Start with the paperwork, then pick the timing
Start reviewing options when the first expiration notice arrives. Researching early is fine; starting replacement service early is a different decision.
- Confirm your exact end date and small-commercial status.
- Save the current terms, EFL and expiration notice.
- Compare renewal and replacement terms using your usage and demand history.
- Check recurring fees, cancellation terms and any bill credit (rebate) conditions. Don't count an uncertain rebate as guaranteed savings.
- Set the new start date inside the fee-free window or at expiration, and keep the confirmation.
Frequently asked questions
Q: How much notice must a small commercial customer get?
A: The final notice must arrive at least fourteen days before expiration, and the rule requires at least three written notices during the last third of the term.
Q: Can I leave during the last fourteen days without a termination penalty?
A: Yes, under the small-commercial expiration rules. Confirm the exact end date, especially if it's tied to a meter read. Other charges you properly owe still apply.
Q: What happens if I ignore the final notice?
A: Service continues on the default month-to-month plan. You can cancel it without a fee, but its price can change between billing cycles.
Q: What if the provider didn't send the required notice?
A: If you haven't chosen another plan, the provider must keep you on the fixed-rate terms until it sends the notice or you pick a new plan. Ask for the delivery record before disputing a change.
Q: Do the same protections apply to larger businesses?
A: Don't assume so. Larger and some aggregated accounts can have different written protections. Check your contract and account classification.
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