Today’s consumers have more tools than ever to track and control their finances. Prepaid electricity companies offer one such way to keep an eye on spending.
Let’s look a little closer at pay-as-you-go energy plans and how they can be useful for some Texas electricity customers.
What is pay-as-you-go energy?
Just as the name implies, pay-as-you-go energy means you add money to your electricity account and get charged as you use energy — not at the end of a billing cycle. It’s similar to prepaid phone service, where you load money into your account, monitor your usage/balance and add more funds as needed.
How do prepaid electricity companies work?
According to the Public Utility Commission of Texas (PUCT), you can expect the following from prepaid electricity:
- Instead of a traditional deposit, you’ll need to make a “connection balance” payment to begin prepaid service with a Retail Electricity Provider (REP). This sets up a positive balance before you activate your service. Depending on the REP, you may need an initial balance of up to $75. (Note that Transmission and Distribution Utility fees could increase this initial amount.)
- As a prepaid customer, you won’t receive monthly electricity bills. Instead, you’ll receive e-notifications from your REP about your account balance. This will let you know when to add funds to your account to keep your service going.
- Prepaid electricity companies have their own fee structure. There may be a minimum balance requirement of up to $10 to avoid service disruptions.
- If your account falls below this minimum balance, your electricity could be turned off without much notice. If you have a negative balance, you’ll need to pay that off before the service is reconnected.
- If you need to get on a deferred payment plan, you can contact your REP.
For more specifics about prepaid energy programs in Texas, visit the PUCT’s FAQ page.
It’s important to note that not all Texas Retail Electric Providers (REPs) offer this type of prepaid energy plan. If you’re interested in pay-as-you-go energy, make sure that is an option with the REP you select.
What are the advantages of prepaid electricity companies?
Prepaid, pay-as-you-go energy plans that don’t require a credit check can be an attractive option for people who:
- Have not established a credit history.
- Have poor credit history.
- Do not have the funds to pay for a deposit on a regular power plan.
- Are on a tight budget and want to pay in smaller sums. You’re in control of how much you pay and when.
- Want to have more control over their energy usage and bill by allowing you to easily track your usage and your budget.
- Don’t want to be locked into a long-term contract.
As you can see, this no-deposit electricity option could be helpful in certain situations.
Which prepaid electricity companies should I check out?
Before you sign up with an REP, make sure to read their prepaid plan details. Each REP may have slightly different rules.
A couple reputable Texas companies that offer pay-as-you-go energy are Reliant Energy and Direct Energy.
Reliant Energy
The Reliant Energy Prepaid Power plan offers “electricity with no deposit, no credit check and no hassle.” You can pay using the Reliant app, online or at one of their stores.
On the Reliant prepaid plan, you’ll get texts letting you know if your balance is low. You can also schedule automatic reloads, so you don’t have to worry about your balance getting too low.
Direct Energy
Another convenient option is Direct Energy’s Residential Prepaid Electricity Plan. Like Reliant, Direct Energy offers:
- Same-day electricity service after your make your initial payment;
- Online account management;
- Usage and reminder texts/emails; and
- Easy payment options.
What are alternatives to pay-as-you-go energy plans?
Prepaid electricity companies and plans aren’t your only option. Here are some other ways to fit your electricity bill into a tight budget:
Average Billing
Many Texas electricity companies, like Cirro Energy, Green Mountain Energy, Direct Energy, Reliant Energy and more, offer Average Billing. These programs make your bills more predictable by basing your balance on your average monthly charges over the past year. This helps you avoid bill spikes and makes it easier to manage your budget.
For details on how Average Billing works, including how your bills are calculated, contact the REP directly.
Multiple Payments
You can often make several smaller payments on your balance instead of one large payment. For example, Green Mountain Energy accepts up to 3 payments in 5 days, and up to 5 payments in 30 days. This option can help you meet your electricity needs without using pay-as-you-go energy.
Deferred Payments
If you fall behind on your account, many Texas power companies offer payment plans that can get you back on track. To see what help your current REP offers, speak to a customer service agent about your situation.
Low-Income Assistance
Many electric companies in Texas offer programs or benefits to help low-income households pay for their utilities. To see if you qualify for any of their programs, call your REP.
Shopping for electricity is easy with Everything Energy.
If prepaid energy is not for you, try shopping for a short- or long-term electricity plan with Everything Energy. With just a few clicks, you can narrow down your plan options and find the best fit for your home, family and lifestyle.
Simply enter your ZIP code to get started.