Are you looking for a new electricity plan but aren’t sure which is the right plan for you?

Have you heard that you might benefit from a pay-as-you-go electricity plan, but aren’t sure what it actually entails?

We understand how stressful shopping for the right plan can be and we want to make life easier.

In this guide, we’re providing insight into how pay-as-you-go electricity plans work, who may benefit from them, and what other options are available to you through Gexa Energy. Keep reading to learn more.

Table of Contents

●     What Is Pay-As-You-Go Electricity?

●     How Does Pay-As-You-Go Power Work?

●     Who Might Pay-As-You-Go Electricity Be Right For?

●     Who Might Not Benefit From Pay-As-You Go Electricity?

●     Is Pay-As-You-Go Electricity More Expensive?

●     Comparing Pay-As-You-Go Electricity

●     Explore Your Electricity Options With Gexa Energy

What Is Pay-As-You-Go Electricity?

Pay-as-you-go electricity plans allow consumers to pay for the electricity they expect to use in advance. Pay-as-you-go plans involve paying for electricity how and when you choose.

These plans involve paying for electricity before you use it, giving consumers more control over their budget instead of waiting until the end of a billing cycle when the electricity has already been used.

You may have also heard of pay-as-you-go electricity plans referred to as month-to-month plans. This is because you’re paying for your electricity on a month-to-month basis, but not every pay-as-you-go plan requires that.

Some consumers choose to pay for electricity on a weekly, biweekly, monthly, etc. basis.

How Does Pay-As-You-Go Power Work?

When you choose a pay-as-you-go electricity plan, you purchase electricity before you use it.

You have the ability to pay for electricity whenever you want. If your account runs low, you can add more funds to your account. As long as funds are in your account, you’ll continue to have electricity.

Once the balance is gone, your electricity service gets disconnected.

When using pay-as-you-go electricity plans, it’s vital to keep a balance in your electricity account.

Most electricity providers charge a reconnection fee anytime your account becomes disabled. This fee can range anywhere from 35 dollars or more each time you need to reconnect.

Companies who offer pay-as-you-go electricity plans may have a minimum balance requirement — meaning if you go below a specific amount in your account, you risk having your electricity shut off.

These companies may also require a new customer to have a higher minimum balance in their account for a set period of time. 

Who Might Pay-As-You-Go Electricity Be Right For?

Pay-as-you-go electricity plans aren’t the best fit for every lifestyle, but there are circumstances where a plan like this may fit a consumer’s needs.

Other circumstances where pay-as-you-go electricity plans may be beneficial include:

●     Little credit history

●     Bad credit history

●     Tight budgets

Who Might Not Benefit From Pay-As-You Go Electricity?

Pay-as-you-go electricity plans might seem like they are saving consumers money, and in some cases they are, but it’s not uncommon for consumers to end up paying more in the long run for these plans.

Imagine this:

Sophie forgot to make a payment on her account and isn’t at home for the weekend; checking her electricity account is the last thing on her mind during her weekend away.

By the time she gets home, her power has been shut off for two days, all the food in her refrigerator has gone bad, and her apartment is hot and muggy from a lack of cool air for several days.

Now, not only does Sophie have to worry about paying reconnection fees, she also has to worry about paying a higher than regular grocery bill and work on cooling her apartment down without going over budget.

Pay-as-you go electricity plans come with a variety of factors that you should consider, including:

●     Inconvenient payment plans — you have to keep up with your account balance at all times or deal with your electricity being shut off.

●     Hidden fees — pay-as-you-go electricity companies often charge fees for paying in specific ways, such as with a check, or paying your bill over the phone, etc.

●     Variable rates — most pay-as-you-go plans have constantly fluctuating prices, when the market price goes up, your price per kilowatt might, too.

Is Pay-As-You-Go Electricity More Expensive?

Pay-as-you-go electricity plans may be more expensive than traditional fixed-rate or variable-rate contract plans.

This is not only because of the higher rate per kilowatt that often comes with these plans, but pay-as-you-go electricity providers may often charge consumers a “service fee” just for choosing the plan.

Consumers using pay-as-you-go plans will not receive a monthly bill, so staying on top of your account is necessary to avoid ...

●     Late fees

●     Cancellation fees; and

●     Reconnection fees

making your payment much higher than it would be if you receive a bill every month.

Comparing Pay-As-You-Go Electricity

If you’re searching for the best electricity plan for your budget and your home, it’s important that you consider all of your options. What works for your neighbor’s needs may not be what works best for your unique needs.

Pay-as-you-go-electricity plans are one of the many options consumers have to choose from. Retail electricity providers often offer a wide variety of plans to meet consumers’ needs.

With all the technical jargon that comes with pay-as-you-go electricity contracts, the hidden fees, and other stipulations that may come with pay-as-you-go plans, it’s hard to know if it’s the right plan for you.

Curious about other electricity plan options available? Here is a look at a few other plans that may better suit your needs.

Pay-As-You-Go Electricity vs. Fixed-Rate Electricity Plans

Fixed-rate electricity plans provide consumers with the ability to pay a fixed rate per kilowatt every month. This means that the rate you pay every month won’t change for the length of your contract even if the cost of electricity goes up.

At Gexa, we offer 12, 24, and even 36-month fixed-rate contracts, giving you peace of mind that your rates won’t change for the length of your contract.

Pay-As-You-Go Electricity vs. Month-to-Month Electricity Plans

Unsure if a fixed-rate contract is right for you? Consider a month-to-month electricity plan.

Instead of worrying about ...

●     Minimum balance requirements

●     Constantly checking account balances; or

●     Wondering if you’ve used too much electricity for the week

month-to-month plans offer the flexibility of no long-term commitments and no cancelation fees.

Pay-As-You-Go Electricity Plans vs. Free Electricity Plans

Are you someone who is rarely home on weekends? Or maybe you work a nine-to-five and only spend a few hours at home in the evening?

A free energy electricity plan might be the perfect plan to help you save money on your electricity bill.

When you sign up for a free electricity plan, you will have specific times of the day where you are not charged for the electricity you are using.

For instance, with the Gexa Free Morning and Nights Electricity plan, you receive free electricity during the hours of 8:00 p.m. to 8:00 a.m. 

Forget having to worry about budgeting and checking your account balance regularly. With free electricity plans, you know when to use your electricity and how to lower your electricity bill, no strings attached.

Explore Your Electricity Options With Gexa Energy

Looking for the right electricity plan for your unique needs? Gexa Energy understands how difficult it can be to choose.

There are so many factors to consider, and we’re here to help you make the best choice for your budget and lifestyle.

Our electricity plans range from:

●     Fixed-rate plans

●     Free energy plans; and

●     Plans that provide usage credits if you stay within a certain range of usage each month.

Plus, all of our residential electricity plans are 100% green.

Don’t risk overpaying for electricity with pay-as-you-go plans that can leave you unsure and underprepared. With Gexa Energy you can count on great service and great prices backed by our Happiness Guarantee*

Gexa Energy purchases renewable energy credits (RECs) from renewable generation resources throughout North America to match 100% of the energy sold under your electric plan.  The RECs Gexa purchases represent the renewable attributes of power generated from a variety of renewable energy sources, including, but not limited to, the sun, wind, geothermal, hydroelectric, wave or tidal energy, and biomass or biomass-based waste products, including landfill gas. 


* Happiness Guarantee - If you’re not happy with your new Gexa Energy residential plan, just call us within 60 days of your service activation date, change to another available Gexa Energy plan, and we’ll waive the early cancellation fee on your first plan; applies one time only for new Gexa Energy residential customers. Your contract term will restart with your second plan. Offer subject to change or withdrawal prior to customer acceptance.