Since many electricity markets are around the country have become deregulated (eg, Texas), it has spawned more competition. By all accounts, this has been a good thing for consumers because it’s led to better customer service, more green energy choices and more flexible payment options.
But, it’s also brought its share of pariahs to the market; that’s what many energy experts think of prepaid electric plans – for they cost consumers much more than regular electricity plans – as much as double or even triple in some cases.
How Consumers Get Sucked into High Cost Prepaid and No-Deposit Electric Plans
One of the ways consumers get pulled into these plans is the ostensible “savings.” For example, you may be charged an initial low turn-on fee. But within the first month, you’re usually asked to pay more.
Between the “low” turn-on fee and the amount you’re asked to pay just a few weeks after getting service can be equal to or greater than the amount you would have paid if you’d just signed on with a conventional Texas electricity company and paid the deposit. And, the gouging doesn’t stop there.
While customers with good credit pay the lowest rates around (eg, between 8 cents and 11 cents per kilowatt hour at the time of this writing), those with prepaid plans can be paying 15 or 16 cents per kilowatt hour.
To avoid being sucked into high-cost prepaid electric service plans like this, ask about money-saving options like the LITE-UP Texas program. Not only is it a no-deposit electric service plan, you get savings five months out of the year (May through September).
Even if you have to save up to pay a deposit with a traditional Texas electric company, the savings you’ll garner over the long haul are worth it.