"Switch and save on power" does not apply to you.
Most Texas power-shopping articles tell you to compare retail electric providers on Power to Choose and pick the lowest rate. That advice is right for about 85% of the state. It is wrong for you.
When the Texas legislature passed PURA Chapter 40 in 1999 and opened the retail market in 2002, every Texas electric cooperative was given a one-time vote: opt in to retail choice, or stay vertically integrated. Every single Texas co-op, including DSEC, voted to stay out. That decision still stands.
So there is no REP for you to switch to. DSEC generates or buys your power through Golden Spread, owns the wires that bring it to your meter, reads the meter and bills you. One company, one bill, one rate schedule set by your elected board, not by the PUCT.
How a DSEC bill is built. Three layers, one cooperative.
In a deregulated Texas city like Dallas the bill has a supplier line and a separate TDU line. On your DSEC bill the same costs are folded into the co-op total, but the layers still exist underneath.
Layer 1 : Wholesale power
Energy charge
DSEC buys nearly all its power wholesale from Golden Spread Electric Cooperative, a G&T co-op based in Amarillo. Your usage in kWh is multiplied by the energy rate.
Layer 2 : Wires
Distribution
4,643 miles of line, transformers, substations and meter reading across Deaf Smith, Castro, Oldham and Parmer counties. Roughly $6,400 of plant per member, since the panhandle is sparsely populated. You pay for it whoever sells you power.
Layer 3 : Fixed
Service charge & tax
A flat monthly service charge that pays for the meter, billing and customer service. Plus the City of Hereford's local sales tax on electricity. You pay this even at zero kWh, like a subscription fee.
DSEC publishes one combined per-kWh rate and a separate service charge. Underneath, those three layers are still there. Knowing the split tells you which lever moves your bill.
Every line on your DSEC bill, decoded.
DSEC's billing language is simpler than a deregulated REP bill. Here is what each line on your statement actually is.
| Line on your bill | What it really is | Who sets it | Shoppable? |
|---|---|---|---|
| Energy charge / Generation | Layer 1 : wholesale power from Golden Spread | DSEC board, GSEC contracts | No |
| Distribution / Delivery | Layer 2 : wires, poles and the meter | DSEC board (no PUCT review) | No |
| Power cost recovery factor | Layer 1 adjustment : fuel and SPP wholesale swings | Tracker, updates monthly or quarterly | No |
| Customer / Service charge | Layer 3 : fixed monthly fee | DSEC board | No |
| City sales tax | Layer 3 : local sales tax on electricity | City of Hereford / Castro County | No |
| Capital credits allocation | Your share of co-op margins, returned later | DSEC board annually | Refunded |
In Dallas your bill calls the wires part a TDU charge and lists a separate supplier. On your DSEC bill it is one line. Same physical costs, different presentation.
Texas co-op rates run cheaper than the state IOU average.
Texas electric cooperatives averaged about 12.7¢/kWh across all residential members in 2024 (NRECA / EIA Form 861). The Texas all-sectors residential average across IOU territory was 14.92¢/kWh in March 2026 YTD (EIA Electric Power Monthly).
That gap exists because co-ops are non-profit. Any margin above operating cost gets allocated back as capital credits and refunded to members on a board-set schedule, typically 10 to 25 years later.
If you have been a DSEC member for a decade, there is a balance with your name on it waiting for the board's next capital credit retirement. The amount is not optional revenue for DSEC; it is your money.
at Texas co-op average rates, all-in
Behind the scenes: how your rate is actually set.
No PUCT rate case. No supplier auction. Four governance layers, every step inside the cooperative system.
Member-elected board
DSEC is governed by a board of directors elected by you and the other ~2,645 members at the annual meeting. The board, not the PUCT, approves rates and the budget. One member, one vote, regardless of how much power you use.
General manager and staff
The board hires a general manager who runs the cooperative day to day from the Hereford office. Linemen, dispatchers, member service and engineers all report up to the GM. Total staff is small compared with an IOU because the territory is rural.
Annual budget and rate review
Each year the board reviews the cost of wholesale power, the maintenance backlog on 4,643 miles of line and the federal cost-of-debt at RUS. If costs move, the rate moves. Any surplus margin becomes capital credits allocated back to members.
Golden Spread wholesale supply
DSEC is one of 16 distribution co-ops that own Golden Spread Electric Cooperative, the G&T based in Amarillo. Golden Spread runs gas plants, contracts wind and solar, and dispatches across both the SPP grid (where DSEC sits) and a smaller ERCOT footprint to the south.
No part of this process is set in Austin or by the PUCT. The result: rates can change faster than in IOU territory when wholesale moves, but margins flow back to members instead of shareholders.
Five expensive habits to drop.
Five patterns we see again and again on panhandle co-op bills. Each costs real money. Each is fixable in an evening.
Outages, blue northers and what to do.
The Texas Panhandle is on the SPP grid, not ERCOT, so the February 2021 freeze that crashed ERCOT mostly spared DSEC members. SPP rotated outages for a few hours; ERCOT had several days of unplanned blackouts. The split matters every winter.
Local risks for DSEC are different: thunderstorm wind shear, ice loading on long rural spans and the occasional grass fire under a transmission corridor. Report an outage by calling DSEC at 806-364-1166 or via the outage map at the cooperative's website. SmartHub at dsec.smarthub.coop shows your service status.
Have a backup: flashlight, a corded phone if you keep a landline, a battery bank charged. Generators on long extension cords kill more panhandle residents in cold snaps than the freeze itself.
What to actually do as a DSEC member.
Sign in to SmartHub
Create your DSEC SmartHub account at dsec.smarthub.coop. You get bill history, daily kWh charts and outage alerts.
Read your latest bill
Note the kWh used, the per-kWh rate and the service charge. Those three numbers explain every dollar on the page.
Vote at the annual meeting
Your DSEC board sets the rate. Show up, vote, run a candidate. This is the closest the United States gets to direct utility democracy.
Apply for CEAP if eligible
The Texas version of LIHEAP is CEAP, run by TDHCA via local Community Action agencies. Apply through TDHCA each year.
Cut usage, not rates
You cannot switch suppliers, so usage is the lever. LED lighting, a smart thermostat and properly sized AC pay back the fastest in this climate.
Keep capital credits alive
Update your address if you move. Capital credit retirement checks can arrive 10 to 25 years after the margin year. Lost members forfeit eventually under state unclaimed-property law.
Common questions about Deaf Smith Electric Cooperative.
No. DSEC opted out of retail choice in 2002 along with every other Texas electric cooperative. Power to Choose only lists REPs in the deregulated 85% of Texas. For ZIP 79045 there are no competing offers; DSEC is your only option for grid-tied service.
SPP. The Texas Panhandle is part of the Southwest Power Pool, a 14-state regional grid run separately from ERCOT. Golden Spread, DSEC’s wholesale supplier, operates on both grids but DSEC’s service territory itself is SPP. That is why the February 2021 ERCOT blackouts mostly missed Hereford.
Call DSEC at 806-364-1166. The number is staffed 24 / 7 for outages. You can also use the outage map and reporting tool on deafsmith.coop, or check status in your SmartHub account at dsec.smarthub.coop.
Co-op margins above operating cost are allocated to your account each year in proportion to how much you spent on electricity. The board decides when to retire (refund) past allocations, typically on a 10 to 25 year cycle. You will receive a check or bill credit when your retirement year comes up. Keep your address current with DSEC; unclaimed credits eventually escheat under Texas state law.
Texas Utilities Code Chapter 41 exempts electric cooperatives from PUCT rate-of-return regulation. Instead, your elected DSEC board sets rates, and federal RUS rules on debt coverage act as a financial backstop. The trade-off: less external oversight, but you can vote out the board.
1501 E 1st Street, Hereford, TX 79045. Office hours are 8 am to 5 pm, Monday through Friday. The outage line at 806-364-1166 is staffed around the clock. For digital service, SmartHub at dsec.smarthub.coop is available 24 / 7.
More U.S. states with energy choice
Same playbook, different utility. Pick another deregulated state to compare utilities, suppliers and switching rules.
