HOW A FIXED-RATE ELECTRICITY PLAN CAN SAVE YOU MONEY
With costs rising in nearly every area of today’s household budgets, Texas consumers are rightly concerned about fluctuating energy prices. Variable rate electricity plans provide needed flexibility for customers in certain seasons, however, Payless Power’s fixed-rate energy plans help residents with long-term cost savings and predictable budgeting.
Variable and Fixed-Rate Electricity: What’s the Difference?
A variable rate electricity plan is a month-to-month plan with no contract or cancellation fees. The rate per kilowatt-hour (kWh) fluctuates based on the market price of power. Customers can benefit from lower market prices, but will likely pay higher rates if there is extreme weather or adverse market conditions.
Those who may benefit from a variable rate plan are customers who need a short-term solution before choosing a plan, plus the ability to cancel on short notice with no cancellation fees.
In contrast, a fixed-rate electricity plan provides a constant, set price per kWh for the length of the contract. The only changes to your bill will be based on the amount of electricity used, plus any potential fee changes from Transmission and Distribution suppliers or Texas’s governing board ERCOT (which would also change on variable rate plans).
Practically, electricity may cost 16.5 cents per kWh on a variable rate plan one month and 18.5 cents the next, while a fixed-rate plan would charge 16.8 cents per kWh for the length of the contract. Variable plans may see a dip or spike in costs based on market price, while fixed-rate plans remain steady. For example, using 1000 kWh per month, each customer would pay the following:
- A variable rate customer would pay $185 if electricity was under the higher market rate.
- A fixed-rate customer would pay $168 that same month.
Pros of Fixed-Rate Electricity From Payless Power
Fixed-rate energy plans allow customers to avoid price spikes during high-demand usage, like extreme or prolonged seasons of hot or cold weather. Payless Power offers several fixed-rate plans that benefit customers in the following ways:
- Pricing is predictable. The cost per kWh remains the same, so if you use the same amount of electricity each month, the pricing will remain relatively constant. You can estimate your power bill based on usage and the fixed rate.
- Tracking and adjusting electricity consumption is easy with daily texts or emails from Payless Power. You can save money by reducing your usage, whether it’s using less power during peak seasons or tapping up your thermostat just a bit overnight. Read more ways to reduce your bill here.
- The contract lengths are short. Some electric providers offer 24- to 36-month contracts that make customers feel stuck. Payless Power’s fixed-rate contracts are only six or 12 months long.
- Payless Power offers prepaid electricity plans that require no deposits or credit checks. It’s not burdensome to sign up, there’s no waiting on credit scores or history, so choosing a fixed-rate plan is easy.
- The initial $40 connection fee goes toward the price of electricity on your first bill, not a huge deposit that doesn’t benefit the customer.
- The prepaid electricity plans (or pay-as-you-go) mean you control when and how you pay. You pay in advance for power, use electricity, and add more funds to your account when it’s needed. You won’t need to worry about large power bills at the end of the month.
- The cancellation fee is affordable. Even with short contracts, if you need to cancel before the term is up, Payless Power’s fee is minimal (only $99) compared to other companies. And with no deposit to connect electricity, the savings on the front end helps cushion any costs like cancellation.
When is the Best Time To Renew My Electricity Plan?
Electricity prices fluctuate with the seasons, based on supply and demand. If you’re moving to a new home or apartment, you need electricity from day one. But you may decide to choose a variable rate plan until you can find the lowest price for a fixed-rate plan. So when is the best time to lock in the best rate on a fixed plan?
While you can’t fully predict energy prices, you can make informed decisions based on demand and historical data. Energy usage is typically at its peak during hot Texas summers. Keeping the house cool with air conditioning, plus increased usage of indoor appliances increases rates.
In Texas, the lowest-demand months are typically December through March. If you lock in a fixed-rate plan during these months, you may find the best rates. However, don’t wait for perfect timing if you find a plan with better rates than you’re currently paying.
Choosing a Cheap Fixed-Rate Electricity Plan
Texas’s deregulated energy market gives residents dozens of options for Retail Electric Providers (REP), as opposed to only one or two choices in U.S. states that aren’t in deregulated markets. Since 2005, REP Payless Power has consistently given Texans affordable, accessible prepaid electricity plans without the burden of large deposits or background checks.
Payless Power is based in Dallas-Fort Worth — a Texas company created for Texans. Lone Star State residents have the power to choose their provider, and Payless Power works to offer the best prices and the best customer service. You can find fixed-rate plans that are affordable and predictable, yet flexible for your needs. You can choose when and how you pay in order to keep your account balance positive. You can track your usage every day and adjust your energy usage to save money. You can select a prepaid plan with only six- or 12-month contracts.
Even with inflation for everyday items, you can find ways to save money with a Payless Power fixed-rate energy plan. Read your Electricity Facts Label (EFL) to discover your typical monthly usage over a year’s time (to see high and low usage months) and multiply that with the current price per kWh to help estimate future bills.
Payless Power fixed-rate electricity plans are simple without confusing gimmicks or hidden fees. Simply enter your zip code to find a plan that’s easy to connect, simple to track, and convenient for making payments.
