How much did you spend on electricity today?
If you have a standard electricity plan, you’ll have no way of knowing. However, prepaid electricity plans give you the power to monitor your daily usage, down to the hour! Considering that electricity costs Americans an average of $2000 a year, being able to see exactly where your money going is a wonderful advantage.
Are you considering breaking away from your electricity contract? If yes then you’re in the right place. In this article, we’ll review what prepaid plans are and how they work.
Read on to find out the truth about prepaid electric companies.
What Is Prepaid Electricity?
First, let’s look at what prepaid electricity means. When you’re on a prepaid plan, you’ll be paying for your electricity, before you ever use it. By paying ahead, you’ll be able to take control of your monthly prepaid electricity bill.
Every prepaid plan has its own set of rules, and ways of doing things. The plan you choose will dictate how you pay, as well as how often you pay.
It’s common for prepaid plans to have an initial service fee that ranges anywhere from $50-$100 or more.
After paying the initial service fee you’ll also need to pay to cover your future balance. For instance, your electricity company may ask for a $50 initial startup fee, and $50 to cover your future electricity usage. Once you pay the startup fee and put funds towards your balance, you’ll be able to start using electricity right away.
Unlike traditional electricity plans, you won’t have to worry about making a large deposit, even if you have poor credit. Instead, you can focus on finding no deposit electric companies, to make things easier.
Once you have your account set up and ready to go, it’ll be a lot like paying for a prepaid phone plan. Instead of paying 1 large bill at the end of the month, you can pay every day, every week, or however, you like. Just make sure you’re paying enough to cover your current and future balance so that you don’t go into debt.
Debt Recovery Programs
A lot of prepaid plans have debt recovery programs. If your electricity company offers a debt recovery program, part of your next payment will go towards your debt.
For instance, let’s say you owe $50 for electricity. If you pay $20, part of your payment will go towards prepaid services, while a small percentage, probably around 30%, will go towards paying off the $50 debt.
Monitor Energy Usage
How much electricity does your household use every day? Now you can find out! It’s common for prepaid plans to have websites, and even applications, that allow you to easily track your electricity usage.
We suggest you monitor your home’s usage daily to start. You can set up alerts to keep you informed about the status of your account.
Here’s a shortlist of the type of alerts you can request:
- Daily balance and usage
- High usage
- Missing usage
- Low balance
- Pending Disconnections
If you notice a large spike in energy usage, take a moment to review your household habits. The usage reports are also detailed by the hour so you can see exactly when the most energy is being used.
What Are the Benefits of a Prepaid Plan?
Now let’s look at all of the advantages of using prepaid electricity plans. To begin with, having a prepaid account means never having to receive an electricity bill. Instead, you’ll be able to conveniently add money to your balance online, over the phone, or at a prepay station.
Next, by having the ability to monitor your daily electricity usage, you’ll become more energy conscious and therefore more conservative. Another advantage is that if there is something wrong with your home, like an issue with your attic’s insulation, you’ll notice the spike in your energy bill sooner rather than later.
You’ll also be able to move around more freely since there aren’t any contracts when you’re a prepaid customer. Finally, since there aren’t any contracts, you also won’t have to worry about any termination fees.
Disconnections and Reconnections
To avoid having your electricity disconnected in the first place, we suggest you monitor your daily usage online. However, we understand that sometimes life gets crazy, and things slip through the cracks.
What happens if your electricity is disconnected while you’re enrolled in a prepaid plan? It’s similar to what happens when you lose electricity under a standard plan.
How Disconnection Works
If you allow your prepaid balance to hit $0, you’ll enter the pending disconnection stage. If you set up pending disconnection alerts, this is the time you’ll receive a notice warning you of the upcoming disconnection.
All you have to do is add money to your account and you’ll be in the clear. However, if you fail to add funds to your account, it’s likely your electricity service will be disconnected by noon the next day.
How Reconnections Work
Before you pay money to have your service reconnected, call your electricity company. Find out what payment method will help you have the fastest reconnection.
For instance, paying over the phone might not be the best option since those payments can take a day to post. Instead, you might need to pay online or in person.
Explore Your Options
There you have it, the ins and outs of prepaid electricity plans. After reading this article, what benefits about prepaid plans excite you the most?
Are you looking forward to finally having an electricity company that doesn’t require a large deposit? Or do you love the idea of being able to monitor your daily electricity usage online?
We hope that our article will encourage you to consider using prepaid plans for your household. For more tips like the ones in this article, check out the rest of our site!