You have been researching for hours trying to find the best electricity plan for you.

You have run into the idea of prepaid electricity plans a couple of times and have read people’s claims that they save tons of money by using one.

Your browser history is a litany of prepaid-related search terms - “prepaid electric companies in Killeen TX”, “cheap prepaid electricity”, “prepaid electricity Texas”...

You keep seeing mixed reviews and you’re skeptical.

If you are thinking that a prepaid plan sounds too good to be true, we agree.

This guide will help you understand what a prepaid plan is and why there are better options out there for you.

Continue reading to learn the ins and outs of the prepaid electricity world and find solutions that are built to help you have the best experience possible with your electricity.

Table of Contents

●     What Is Prepaid Electricity?

●     How Do Prepaid Electricity Plans Work?

●     Are Prepaid Electricity Plans the Same as Pay-as-You-Go Electricity Plans?

●     How do Prepaid Electricity Companies Set Prepaid Energy Rates?

●     How Do I Know if a Prepaid Electricity Plan is Right for Me?

●     Is There a Downside to Choosing a Prepaid Electricity Plan? 3 Disadvantages to Choosing Prepaid Electricity Plans

●     What Other Options Do I Have Aside from Prepaid Electricity? Texas Electricity Plans

●     Gexa Energy’s Electricity Plans in Texas Are 100% Happiness Guaranteed: Make the Switch Today*

What Is Prepaid Electricity?

Prepaid electricity is exactly what it sounds like - electricity you pay for before using.

Instead of the traditional method of using your electricity and then paying the bill at the end of the month, prepaid electricity allows you to pay in advance and then use up that payment’s worth of electricity.

With prepaid electricity, you can more easily monitor your usage and remain on budget.

How Do Prepaid Electricity Plans Work?

Every prepaid plan is unique but the typical plan works by selecting a company and signing up for their prepaid service.

You will be required to make a payment before your first usage when you set up your account so that your balance will be positive.

Are Prepaid Electricity Plans the Same as Pay-as-You-Go Electricity Plans?

Perhaps this is your first time hearing of the prepaid electricity plan but you have heard of the pay-as-you-go option.

You might be wondering… are these the same thing?

Yes. Prepaid electricity and pay-as-you-go electricity are the same things and the titles are often used interchangeably.

How Do Prepaid Electricity Companies Set Prepaid Energy Rates?

Different companies have different rates.

Companies will set their rates with what your electricity usage costs them in mind.

You may find that you pay more per kilowatt-hour with a prepaid plan than you would with other plans.

As with any electricity plan, the amount you pay is tied directly to the price per kilowatt-hour.

This rate is determined by various factors including:

●     Fuel prices (natural gas, petroleum)

●     Local power plant costs

●     Weather conditions

●     State regulations

As these costs go up, so does the cost of your electricity if you don’t have a fixed rate.


How Do I Know if a Prepaid Electricity Plan Is Right for Me?

Prepaid plans can work well for a handful of people but, for the majority, the traditional plans just work better.

If you need lots of flexibility or are hesitant about having a credit check, a prepaid plan might be the one for you.

But if you want dependability and access to great, fixed rates, prepaid is not your best option.

One potentially good thing about prepaid plans is that they usually do not require a credit check since you are paying upfront, before using any electricity.

If you have a poor credit history or simply have not yet had the chance to build a good credit history, a prepaid plan might be your best - or only - option.

However, if you have a relatively good credit history or are working with a company that is still willing to supply you with electricity, choosing a post-pay option is usually better because prepaid electricity plans often cost far more.

Many companies are willing to work with customers who have a poor credit history or none at all.

Is There a Downside to Choosing a Prepaid Electricity Plan? 3 Disadvantages to Choosing Prepaid Electricity Plans

While a prepaid plan can look rather glamorous at first, there is a downside to this option.

You often end up paying higher rates and, depending upon your dependability with payments, you might experience issues with access to your electricity

#1: Upfront Costs

Your up-front costs to get your electricity up and running can be pretty high.

For starters, in Texas, your company can require that you have up to $75 in your account for your first service period.

You will also have to pay Transmission and Distribution Utility fees - called TDU for short - which could bring your total well above the $75 mark.

TDU fees are passed directly to you from the company that owns the power lines and other electrical apparatus that brings the electricity to your home.

These companies do the maintenance work on the lines and keep everything running.

Contrary to popular belief, your REP, or Retail Electricity Provider (many folks simply refer to this as their electricity company), does not own the lines that get the electricity from the plant to your home.

For many, TDU fees can make up around 50% of the overall bill.

While it might seem like a thrifty option, there isn’t such a thing as a cheap prepaid electricity plan.

#2: Hidden Fees

No one likes hidden fees.

They feel dishonest and leave you with a big hole in your budget that you weren't ready for.

Unfortunately, hidden fees often accompany prepaid electricity plans.

There is a very real chance you will end up paying far more than you expected.

#3: Minimum Balance Requirements

Some prepaid electricity plans might have minimum balance requirements, meaning you have to have a certain amount in your account at all times.

While prepaid electricity plans are often touted for their flexibility, minimum balance requirements significantly reduce that benefit

What Other Options Do I Have Aside from Prepaid Electricity? Texas Electricity Plans 

As a Texan, you have an opportunity that many states do not.

If you live in a region of Texas where electricity has been deregulated and you can select your own Retail Electric Provider, you have options that many do not.

But we get it, this blessing can often feel like a curse. There is so much to wade through and figure out.

If you were hoping to find that prepaid electricity plans are a great financial choice and are now feeling disappointed, don’t lose hope.

There are many other economically conscious and relatively budget-friendly electricity plans out there.

While prepaid electricity may not be for you, Gexa Energy has many affordable and high-quality electricity plans.

Not to mention… every Gexa Energy residential electricity plan is 100% green.

Fixed-Rate Electricity Plans

Fixed-rate energy plans can be a great option.

While some electricity plans fluctuate on costs, a fixed rate remains consistent so you can have a better idea of what number will be on your energy charges each month.

Instead of having to worry about your electricity cost jumping per kilowatt-hour, you can rest assured that the rate will not change for the duration of your contract.

How are Fixed-Rate Plans Different from Prepaid Electricity Plans?

Fixed-rate plans are different from prepaid plans in several ways:

●     You pay after you use the electricity

●     Your rate doesn’t change from month to month

●     Your electricity won’t be turned off if you forget to add money to your account

Free Energy Electricity Plans

Free energy electricity plans can be a great way to save money and help save energy as well.

When you sign up for a free energy plan, you get specific times where you are not charged for the electricity you use.

For instance, with the Gexa Free 3-Day Weekends Electricity plan, you get free electricity all day and all night beginning at 12 AM on Friday and ending at 12 AM on Monday.

In other words, with the Gexa Free 3-Day Weekends Electricity plan, you don’t pay for what you use on the weekend.

It’s free electricity.

Forget prepaid electricity, free nights and weekends are typically a much more budget-friendly option.

How are Free Energy Plans Different from Prepaid Electricity Plans?

There are some obvious differences like:

●     You pay for the electricity after you use it

●     You get free electricity - with a prepaid plan, you pay for every second

●     With the Gexa Energy plan, you get a locked-in rate for 12 months

Month-to-Month Electricity Plans

With a month-to-month electricity plan, you pay for your electricity each month and your rate can change.

There are fixed-rate month-to-month plans and there are variable-rate month-to-month plans.

Each has its pros and cons.

How are Month-to-Month Plans Different from Prepaid Electricity Plans?

Prepaid electricity plans and month-to-month plans are different in a few ways:

●     Month-to-month plans are paid for after you use your electricity

●     Month to month plans offer some flexibility but not as much as a prepaid plan


Gexa Energy’s Electricity Plans in Texas Are 100% Happiness Guaranteed: Make the Switch Today*

At Gexa Energy, we know that choosing your electricity plan is a difficult task that you take very seriously.

There are many things to consider and we want to help you make the best choice for yourself and your home.

We have many great plans for you to choose - from free electricity to fixed-rate plans, we have thought of everything.

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

Prepaid electricity plans often leave their users unsatisfied and spending far more than they thought they would need to.

With Gexa Energy, you can rest assured that you are getting great service at a great price.

And with our Happiness Guarantee, you can know that we have your back.*


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.