ERCOT Load Zone
Texas Electricity Glossary
An ERCOT load zone is one of four geographic pricing regions within the ERCOT grid — Houston, North, South, and West — that each have their own wholesale electricity settlement prices. Load zones reflect local supply and demand conditions, grid congestion on transmission lines between regions, and generator distribution. For most residential consumers on fixed-rate plans, load zones are invisible — REPs absorb zone price differences. For variable and indexed plan customers, load zone prices can directly affect their monthly rate.
The Four ERCOT Load Zones
| Zone | Major Cities Covered | TDU(s) in Zone |
|---|---|---|
| North | Dallas, Fort Worth, Plano, Arlington, Denton, Waco | Oncor (primary) |
| Houston | Houston, Galveston, Beaumont, Texas City, The Woodlands | CenterPoint Energy |
| South | Corpus Christi, Laredo, McAllen, San Antonio area (deregulated portions), Austin suburbs | AEP Texas Central, TNMP |
| West | Midland, Odessa, Lubbock, San Angelo, Abilene | AEP Texas North, Oncor (portions) |
Why Load Zone Prices Differ
Wholesale electricity prices differ between zones primarily because of transmission congestion. If the North zone is consuming more power than its local generators produce, it must import power from other zones — but transmission lines have capacity limits. When those limits are hit, congestion pricing creates a price difference (called a congestion rent) between zones. West Texas often has negative congestion prices overnight when wind generation exceeds local demand and the transmission lines to North/South zones are full.
Load Zones and Your Plan Choice
When comparing plans on TexasPowerCost.com, you compare plans available for your specific ZIP code — which maps to a load zone. Plans are priced by REPs who account for load zone wholesale prices in their rate-setting. The plan comparison already reflects your zone's pricing environment; you do not need to select a zone manually.
Related Terms
- ERCOT — the grid operator that defines and administers load zones
- Indexed Plan — may be priced based on load zone settlement point prices
- TDU — each TDU broadly maps to one or two ERCOT load zones
- Variable-Rate Plan — variable rates may reflect load zone wholesale prices
Frequently Asked Questions
What is an ERCOT load zone?
An ERCOT load zone is one of four geographic pricing regions that ERCOT uses to settle wholesale electricity transactions. The four zones are Houston, North, South, and West. Each zone has a separate settlement point price that reflects local supply and demand balance, grid congestion on transmission lines between zones, and generator availability. Your ZIP code determines your load zone.
Does my load zone affect my electricity bill?
For residential customers on fixed-rate plans, your load zone has no direct impact on your monthly bill — you pay the locked rate regardless. Load zones matter more to REPs, who buy power in the wholesale market at zone prices. For variable or indexed plans, your rate may reflect the settlement price in your specific load zone.
Which Texas cities are in which ERCOT load zone?
Broadly: North zone covers Dallas, Fort Worth, Plano, Arlington, and most of North Texas. Houston zone covers greater Houston and Southeast Texas. South zone covers Corpus Christi, San Antonio area (deregulated portions), Austin suburbs, and parts of Central Texas. West zone covers Midland, Odessa, Lubbock, San Angelo, and West Texas. Exact ZIP-to-zone assignments are published by ERCOT.