Prepaid Texas Electricity Plans & Rates

What is a prepaid electricity plan?

A prepaid electricity plan lets you pay for a portion of your energy at the beginning of the month and add additional funds as you go. This option differs from traditional deregulated energy plans, which send you an energy bill based on your usage at the end of the month. Prepaid electricity plans are popular with customers who want to avoid a credit check and deposit.

To explore prepaid electricity in Texas, enter your ZIP code on the free Choose Texas Power marketplace and filter your results for “all credit approved.”

Prepaid lights with same-day activation

You can get same-day activation for prepaid lights when you sign up through Choose Texas Power with Payless Power. Enroll by 5 p.m. Monday–Saturday to qualify for same-day activation (service timing can still depend on your local utility and your home’s meter setup).

Pros and cons of prepaid electricity

Evaluate the pros and cons of this energy plan type to determine if it’s a good fit for your needs.

Pros of prepaid electricity

• No deposits: Many electricity providers require a deposit to begin service if you have low credit. This deposit could equal as much as two months’ worth of electricity, which can be a large upfront cost. The ability to skip a deposit is a major benefit for shoppers on a tight budget.
• No credit check: This goes hand-in-hand with the previous point. For customers who have low credit or don’t want to undergo a credit check, prepaid plans may be the best — or only — option.
• Shorter contracts: Prepaid electricity plans often have short contracts or operate month-to-month. For shoppers who value flexibility, this option helps you power your home without a big commitment.

Cons of prepaid electricity

• Upfront costs: While prepaid plans do not require deposits, they still require you to pay for your electricity upfront for the month.
• Higher rates: Pay-as-you-go electricity plans are typically more expensive than traditional plans because they have higher rates. Despite skipping the deposit, your overall energy costs may be more than if you chose a fixed-rate plan.
• Minimum balance: Prepaid electricity plans often require customers to maintain a minimum balance. Make sure to read each plan’s Electricity Facts Label (EFL) to verify that you’re comfortable with the minimum balance before enrolling.
• Automatic shut-offs: If you use up all the electricity you paid for that month, your service could get shut off. Once you add more money to your account, the lights will turn back on.
• Fewer options: There is less variety for pay-as-you-go electricity than standard fixed-rate plans. Only a few providers offer prepaid options in Texas, so you’ll have fewer options than if you searched for a traditional fixed-rate plan.

Texas prepaid electricity FAQs

Are prepaid electricity plans a good option?

Prepaid electricity is a good option for shoppers with low credit who want to skip a deposit. However, prepaid electricity plans typically have higher energy rates and can be more expensive. If price is your top priority, a fixed-rate plan with a deposit may be cheaper overall.

How do prepaid lights work?

Prepaid lights work by having you pay money into your electricity account upfront, then the provider deducts charges from that balance as you use power. You can add funds anytime, and if your balance hits the minimum and you don’t reload, your service can be disconnected quickly. The local TDU still delivers the electricity and handles outages, while the electricity provider manages pricing and your account.

How are prepaid plans different than fixed-rate ones?

Prepaid plans require you to purchase a minimum amount of electricity at the beginning of the month to fund your account. Then, you can add more money throughout the month as needed. Fixed-rate plans issue a monthly bill based on your electricity usage for that time period. Another key difference is that fixed-rate plans require a deposit if you have low credit or a history of delinquent payments, whereas prepaid plans do not.

What’s the main drawback of prepaid electricity?

The main drawback of prepaid electricity is that it’s typically more expensive than other options on our marketplace. While this plan type doesn’t require an upfront deposit, it usually has higher rates than fixed-rate options.