Prepaid electricity, also known as pay-as-you-go electricity, operates on an upfront payment model: you load funds into your account, and your daily usage is automatically deducted from these funds. Since you pay before using electricity, there are no monthly bills or credit checks.
Although the core pricing is straightforward, it’s important to note that certain standard charges or requirements may apply when using a month-to-month prepaid service. Knowing these ahead of time helps you stay in control of your account and avoid unexpected costs.
Here are a few routine costs to keep in mind:
- Initial connection payment: Most providers require a starting balance of around $40, which typically goes directly toward your electricity usage rather than being a separate fee.
- Reconnection fee: If your electricity service is disconnected due to a zero or negative balance, a $30 reconnection fee, amortized in equal daily installments, will be applied when power is restored.
- Minimum balance requirement: Providers typically require a small minimum balance (around $10) to keep your service active and avoid automatic disconnection.
- Payment or processing fees: A $4.95 Payment Processing Fee applies to payments under $75. This fee does not apply to AutoPay and is amortized in equal daily installments.
All reputable prepaid electricity providers in Texas must clearly list any potential fees in their Electricity Facts Label (EFL) and Terms of Service (TOS), both of which are available before you enroll. Reviewing these documents ensures you understand precisely how your rate and payments work.