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Prepaid Electricity Texas

By powerwizard

If you’re shopping for electricity in Texas and have settled on a prepaid plan as being the best option, be warned. 

You Could Be Setting Yourself Up To Overpay!

Or a prepaid plan could be the perfect solution for you. 

How can you have confidence that you’re making the right choice?

You Need Power Wizard!

Get peace of mind for your electricity purchase and let the electricity experts find the perfect plan for you. The secret is our unbiased algorithm that scans hundreds of plans to find you the best rate. 

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This guide shares more information on what prepaid electricity is and how you can sign up for the best-prepaid electricity plan today.

What is Prepaid Electricity?

prepaid electricity Texas

Prepaid electric service in Texas can be compared to filling up your gas tank.

When you sign up for a prepaid lights plan in Texas, you “fill up your tank.” You add funds to your prepaid account. Maybe you put in $200. Or maybe you only put in $50. It’s important to know that prepaid electricity plans often have minimum balances, but we’ll get to that later.

If you fill up your car with gasoline and then drive around town, you’ll eventually need to fill up your tank again. It’s the same exact thing with prepaid electricity plans.

As you use electricity, you’ll simply add more funds into your prepaid electricity account.

What is Pay As You Go Electricity? Is That Different?

Pay As You Go electricity plans are the same thing as prepaid electricity plans.

Retail Electric Providers (REPs) started naming their plans as ‘Pay As You Go’ to differentiate them from their competitors who were calling their plans “prepaid electricity plans.”

Here’s all you need to know:

If you see a plan that says “prepaid” and another plan that says “Pay As You Go,” they’re both talking about the same thing.

How Do Prepaid Electricity Rates Work?

On the surface, here’s how prepaid energy companies operate:

  • They supply electricity to your home.
  • You only pay for the electricity that you use.

But, there’s much more to a prepaid lights plan than just that.

Before we share exactly how prepaid electricity plans are structured, we’ll first share some of the benefits of these types of plans.

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prepaid electricity Texas

Benefits of Prepaid Electricity

There are many benefits to using a prepaid electricity plan, such as:

  • No Credit Check: many prepaid lights don’t involve credit checks. If you don’t have the best credit, you may still be eligible to get a Pay As You Go plan.
  • Avoiding Long-Term Contracts: many prepaid electricity plans don’t involve long-term contracts. While this is the cause, there may be a cancellation fee.
  • You Only Pay For What You Use: many people like the idea of a prepaid electricity plan because they’re only paying for the electricity that they use.

How To Use Prepaid Electricity?

This section will share step-by-step on how to use prepaid electricity.

  1. Enroll in a plan: the first step is to enroll in a plan. There are many types of prepaid electricity plans. Some will guarantee you a certain price per kWh. Some will have an initial upfront payment. Some have a hefty cancellation fee. When looking at all the available plans, you’ll need to read through each contract to determine all of the fees and the terms of service.
  2. Add funds to your account: After you’ve enrolled, you can add funds to your account. It’s just like filling up your car with gas. If you run out of gas, your car won’t run. If you use all of your money in your Pay As You Go plan, then you won’t be able to use electricity.
  3. Track your usage: most prepaid plans have a minimum balance requirement. If you use electricity and don’t add more funds, there’s a chance you’ll fall below your minimum balance and have to pay a fee. Or, if you run out of money in your prepaid account, then the electricity company may have to turn off your power due to a lack of funds.
  4. Add more funds as you need them: if you diligently track your usage, you’ll know when your funds are getting low. If you notice your funds are getting low, then you’ll need to add more funds in order to maintain electricity.

Upfront Costs

Some REPs have prepaid lights with no deposit. For these plans, you won’t have to pay an initial fee to get started.

Other plans have upfront costs. For example, you may have to pay an initial service fee of $30 in order to officially get started.

How do you know if there will be upfront costs?

Read the contract and the Terms of Service of each plan. It should clearly state if there’s an upfront cost or not.

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Minimum Balances

Most of the Pay As You Go plans have minimum balance requirements. Some might require you to have $25. Others might require you to have $50. It depends on the plan.

Why is it important to maintain the minimum balance requirement?

If you don’t maintain the required minimum balance, then you’ll likely have to pay a fee. Sometimes, your electricity rate itself will increase.

Here’s a story that explains why this is so important:

Charles lives in Dallas and buys a Pay As You Go plan.

He gets a plan that locks in a rate of 11.7¢ per kWh. He’s happy with the plan during the first month.

During the second month, Charles forgets to add additional funds. His balance goes below the required minimum.

A couple of days later, Charles adds money. But it’s too late.

Per the contract, Charles’ rate increases from 11.7¢ per kWh to 13.9¢ per kWh. And he’s stuck paying that rate. His only other option is to cancel (and pay a $90 cancellation fee).

Hidden Fees

Just like any other electricity plan in Texas, there may be hidden feeds. Before enrolling in a prepaid rate, make sure that you read the contract to learn all of the requirements.

Maintaining Your Plan Through SMS or an App

Many prepaid electricity plans allow you to monitor your plan via SMS, text message, or through a mobile application.

If you manage your plan through text message, here’s how it’ll work:

Each day, you’ll receive a text message sharing how many kilowatt-hours you used that day, how much money you have remaining, and more.

It’ll look something like this:

  • Kilowatt-hours consumed for the day: 37.3
  • Balance remaining: $119.32
  • Savings for the day: $0.92
  • Estimated days remaining: 27

These daily text messages will keep you up-to-date on your plan information, your balance, and an estimation of how many days remain before your funds run out.

If you manage your plan through a mobile app, here’s how it’ll work: To see your usage and balance, you’ll have to log into the mobile app.

Once inside, you’ll be able to see your balance. If you want to add more funds, you’ll be able to do it from the app.

You’ll also be able to see your usage. This is helpful because if you’re trying to save money by limiting your electricity usage, you’ll be able to keep track of that from the app.

Discover the best electricity rates.

Power Wizard finds you the best electricity plan and ensures you won’t overpay for electricity again.

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How Much Does Prepaid Electricity Cost?

Pay As You Go electricity rates change during the year.

With many prepaid electricity plans, you’re not locked into a particular rate.

It’s not like you know that you’ll be paying 10.4¢ per kWh. Your rate will change based on supply and demand. Your rate one day might be 11.8¢ per kWh, and a month later, it might be 15.1¢ per kWh.

Here’s a really important story that could save you hundreds of dollars:

During the summer of 2019, something really interesting happened to many electricity consumers in Texas.

It got really, really hot. As a result, electricity consumers cranked up the AC and started using much more electricity.

At the same time, electricity companies were running out of electricity to sell. They had a shortage.

The high demand combined with the low supply led prices to surge.

For prepaid electricity customers, this was a really big problem.

They were subjected to whatever the market rate was. And for a short period, it was ridiculously expensive.

Using a lightbulb for an hour might’ve cost someone a couple of dollars. It was madness.

The electricity companies told people to keep their windows open and restrain from using electricity.

If you choose to use one of the Pay As You Go electric companies in Texas, just know that you’re rate is oftentimes not locked in.

Is Pay As You Go Energy Cheaper?

First, Pay As You Go energy is different than Pay As You Go electricity.

Energy can be natural gas, geothermal, solar, wind, and more.

With that being said, are prepaid lights cheaper than regular electricity plans?

This is a hard question to answer since it depends on your electricity usage, the size of your home, and more.

Here’s a story that describes a situation in which a Pay As You Go electricity plan is much cheaper than another plan.

Let’s say that you’re a traveling saleswoman. You travel around the country and are away from home for at least 3 weeks per month. Some months you rarely make it home.

When you leave for a long trip, you make sure that everything is turned off so that you won’t be using any electricity.

In this case, a prepaid lights plan might be the best option. You rarely use electricity since you’re rarely home.

Here’s a story that describes a situation in which a Pay As You Go electricity plan is much more expensive than another plan.

Let’s say that you have a large home outside of Corpus Christi.

It’s the summertime, and it’s getting really hot outside. Electricity companies are struggling to keep up with demand. Their supply is getting low, and they start charging much higher electricity rates.

Since you have a Pay As You Go plan, you’re subject to the current rates. Not only that, but you have a large house that uses a lot of electricity.

In this case, a prepaid lights plan might not be the best option. You’re using a lot of electricity, and the market rates are really high.

Cheapest Prepaid Electricity Texas – It Depends On The Person

As we mentioned above, the cheapest prepaid electricity plan in Texas is going to depend on the person.

Someone living in a 550 square foot studio apartment in downtown Houston will likely need a different prepaid electric plan than someone living in a 3,200 square foot house in Fort Worth.

How do you know which electricity plan is best for you?

When it comes to shopping for electricity, you have two main options.

  1. You can manually search through all the electricity plans. You can try to filter them by prepaid vs. fixed rate. You can create spreadsheets that are designed to compare plans. And you can spend hours leafing through contracts full of legal jargon.
  2. You can spend a couple of painless minutes using the Power Wizards Shopping Tool. Our unbiased algorithm gets to know you, your home, and your historical usage. Then, it runs your data through every single available plan to find the best one for you. After finding the best plan, Power Wizard makes signing up easy. Not only that, but our algorithm runs 24/7 to ensure that the plan you choose is the right one for you. If it finds a better plan, it’ll help you switch.
Discover the best electricity rates.

Power Wizard finds you the best electricity plan and ensures you won’t overpay for electricity again.

Learn More in Under 2 Mins

Where Can I Buy Prepaid Electricity?

prepaid electricity Texas

If you live in a deregulated city in Texas, you’ll likely find a prepaid electricity plan that services your zip code.

Before you look at the prepaid electricity rates below, there are a couple of questions that you should ask yourself:

  1. Is a prepaid electricity plan truly the best plan for me and my usage?
  2. If I get a prepaid electricity plan, can I maintain a minimum balance and abide by the rules of the contract in order to avoid additional fees?
  3. Will I save money each month using a Pay As You Go plan?

There’s an easier way to find out the best electricity plan for you:

You can use Power Wizard’s Shopping Tool to find the best electricity rates for your home and your usage. In less than 5 minutes, our unbiased algorithm will match you with the best plan based on your home’s size, how old your home is, your historical electricity usage, and more.

Let us find you the best plan in seconds and start saving.


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