Kilowatt Atlas

Guide

Delivery vs Supply Charges: What Each Part of Your Bill Pays

Most electric bills add two things together: the cost of the energy and the cost of carrying it to your home. Knowing which line is which shows what you can change and what you cannot.

Reviewed

The two halves of a bill

Supply covers the generation of power, or the purchase of it from the wholesale market. EIA says the cost of generating electricity is the largest component of the price of electricity. It rises and falls with fuel prices, with weather and with the cost of power plants.

Delivery covers the wires and everything that keeps them working. EIA lists construction, operation and maintenance of the transmission and distribution system, including repairs after accidents or extreme weather and better cybersecurity. Delivery also includes a fixed monthly customer charge on many bills, which you pay even if you use little.

Your bill may show the two parts separately, as supply and delivery, as generation and distribution, or as energy and delivery. Some bills show one combined rate and no split at all, especially from utilities that provide both services.

An example with made-up numbers

Take a home that used 900 kWh in a month. Say supply is 9 cents per kWh, delivery is 6.5 cents per kWh, and the delivery side also has a $12 customer charge.

Illustrative split of one electric bill into supply and delivery
Part of the billHow it is chargedAmount
Supply9 cents x 900 kWh$81.00
Delivery, usage6.5 cents x 900 kWh$58.50
Delivery, customer chargeFlat monthly$12.00
Total before taxes$151.50

In this example delivery is $70.50 of the $151.50, or about 47 percent. The split differs a lot from place to place. These numbers are not from a real account.

Who sets each price

Who sets the supply and delivery prices in two kinds of market
Kind of marketSupplyDelivery
Regulated utility (most of the country)The utility, under rates a regulator approves, or a municipal board or co-op boardThe same utility, under approved rates
Retail choice stateThe retail supplier you pick, at the price in its planThe local delivery utility, under approved rates

In a state with retail choice, the delivery company is set by where you live, and you cannot switch away from it. Your bill passes its charges through. See the states where you can choose a supplier.

A real example: Texas delivery prices

In the competitive part of Texas, the delivery company is a separate business from your retail electric provider. EIA data show what the largest ones charged on average in 2025 for delivery alone.

Average delivery price by Texas delivery company, 2025
Delivery companyHomesDelivery cents per kWhDelivery bill a month
Oncor Electric Delivery3,545,8145.64$62.35
CenterPoint Energy Houston Electric2,529,0395.41$60.74
AEP Texas Central793,8965.91$68.16
Texas-New Mexico Power237,9307.09$81.64
AEP Texas North158,4885.86$57.47
City of Lubbock94,7386.31$55.17

Source: U.S. Energy Information Administration, Form EIA-861 (final 2025 data), delivery-only residential service. These are 2025 averages, not tariff rates.

These are the amounts that sit on the delivery side of a Texas bill. A provider competes on the energy part. Our guide to the Texas delivery company explains who these companies are.

What you can and cannot change

  • Where retail choice exists, you can compare supply prices and plan terms. Delivery will not change when you switch.
  • Where it does not, you can still lower the bill by using less energy, moving use to cheaper hours on a time-of-use plan, or asking for a lower-cost rate plan.
  • On either side, usage is the part you control most. A kWh costs you supply plus delivery.

Compare the all-in price

When you compare supply offers, make sure the price you read already includes delivery, or add it. The number that matters is the all-in cost per kWh at your usage. See how to read your electric bill.

Names for the same two parts

Supply may appear as energy, generation, commodity or power cost. Delivery may appear as distribution, transmission, wires or customer charge. Riders and adjustments, such as a fuel adjustment, usually sit with one side or the other. Large business customers can also see a demand charge on the delivery side.

Sources and further reading

Frequently asked questions

What is the difference between delivery and supply on an electric bill?

Supply is the cost of the electricity itself. Delivery is the cost of carrying it to your home, maintaining the lines and meters, and restoring power after outages.

Can I choose my supplier but not my delivery company?

Yes, in states with retail choice. You pick the retail supplier, while the local delivery company is set by your address and stays the same.

Why is my delivery charge so high?

Delivery covers poles, wires, meters and crews, which cost more in some places than others. Storm repairs, new construction and upgrades to older equipment also raise it. The regulator reviews those costs when rates are set.

Does a fixed customer charge count as delivery?

On most bills, yes. It is a flat monthly charge for being connected, and you pay it regardless of use.

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