When to Pay Your ETF and Switch Providers

Sometimes, staying in your current electricity contract could cost you more than paying the Early Termination Fee (ETF) and switching to a better plan.

In Texas’ ever-changing electricity market, rates can shift significantly, and sticking with an outdated plan could mean paying more than necessary.

So, how do you know if paying the ETF and switching is smarter?

Here’s a simple way to answer that question without overwhelming math.

Key Takeaways

Paying the ETF may save you more than staying in your current plan. Use Live Link™ to find better deals instantly.
Live Link™ pulls actual usage data, accurately comparing plans in seconds without manual input.
If your savings after subtracting the ETF are positive, switching plans is a smart financial move.

1. Use Live Link™ to Find the Best Deals

Rather than guessing or spending time manually gathering your electricity usage data, Live Link™ simplifies the process.

It pulls your electricity usage directly from your current provider, allowing you to compare plans matching your usage patterns in seconds.

With Live Link™, you can instantly see if switching to a new plan will save you money - and how much you can expect to save over time.

There is no need to dig out old bills or make rough estimates. It’s quick, easy, and based on real data.

2. Compare Annual Costs

Once you’ve used Live Link™ to pull up your options, compare the annual cost of your current plan versus the new plan you’re considering:

Current Plan: Log in to your provider’s dashboard to view the past 12 months of bills. If you don’t have a full year’s worth of data, you can estimate the remaining months based on past usage patterns. Look at similar months from last year, especially for seasonal changes like summer or winter, when electricity usage may vary.
New Plan: Use Live Link™ to see the projected annual cost of a new plan based on your actual usage.

3. Factor in the ETF

Next, look at your current contract’s Early Termination Fee (ETF). Most providers in Texas charge this fee if you break the contract early, but the savings from switching might still outweigh the cost.

If you’re feeling stuck in a contract and unsure about your options, check out our guide on getting out of an electricity contract for more insights.

Potential Savings: Subtract the new plan’s annual cost from your current plan’s yearly cost to determine how much you could save.
Subtract the ETF: To ensure the switch is financially worthwhile, subtract your Early Termination Fee (ETF) from the potential savings. If the remaining savings are still positive, switching makes sense.

Switching is a good decision if your total annual savings after subtracting the ETF are still positive.

Real-World Example

Let’s assume your current plan costs $1,800 per year, and switching to a new plan could bring that down to $1,500 per year. That’s a $300 annual savings.

If your ETF is $150, you would subtract that from your $300 savings, leaving you with a net savings of $150.

In this case, paying the ETF and switching to the new plan is smart since you’ll save $150 even after the fee.

When Switching Is a Smart Decision

There are specific situations where paying the ETF and switching makes clear financial sense:

Significantly Lower Rates: If rates have dropped since you signed your contract, switching to a lower plan could save you hundreds.
Mismatch Between Plan and Usage: A better-fitting plan could lower your bills if your current plan doesn’t match your actual usage.
Moving: If you’re moving to a new home, you might think transferring your electricity service is the easiest option. However, it’s often not the best choice. Your new home will likely have a different electricity usage profile, meaning the plan that worked for your old home might not be the best fit for your new one. Instead of transferring, switching to a new plan tailored to your new home’s usage can help you avoid being locked into an unfavorable deal. Moving is the perfect opportunity to shop for a plan that matches your new usage needs and could save you money in the long run.

Why Long-Term Savings Matter

While paying the ETF is a one-time expense, the savings from switching to a cheaper plan will benefit you over the entire length of your new contract.

Use Live Link™ to compare plans quickly based on your actual usage, and you’ll know immediately whether switching makes sense for your situation.

Switching can feel like a big step, but it’s worth it when the math shows you’ll save in the long run.

With Live Link™ doing the heavy lifting, it’s a no-brainer to compare plans and see how much you can save.

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Written by

Enri Zhulati

Senior Director of Product

Senior Director of Product at Compare Power. 8+ years guiding Texans to smarter energy choices through data-driven tools and editorial excellence.

When to Pay Your ETF and Switch Providers