Month-to-month vs prepaid: they're not the same
If you've been searching for lights without a deposit, you've probably seen "prepaid" come up a hundred times. And maybe you've tried it. Maybe you hated the daily balance draining away, the constant notifications, the feeling of watching a meter tick down instead of just living your life.
That's not what month-to-month is.
Month-to-Month (Traditional)
- ✓ Use power all month, get a bill at the end
- ✓ No long-term contract locking you in
- ✓ Cancel or switch anytime, no penalty
- ✓ Normal billing cycle (pay once a month)
- ! Credit check required (deposit possible)
Prepaid (Pay-As-You-Go)
- - Pay money upfront, balance decreases daily
- - No contract (you're paying as you go)
- - Add more money when balance runs low
- - Higher rates (~$80-100/month more)
- ✓ No credit check, guaranteed approval
Here's the thing the system doesn't make clear: month-to-month and prepaid are completely different products. Month-to-month is regular light service without a contract. You use power, get a bill, pay it. Like a normal person. Prepaid is a separate system where you load money and it drains as you use power.
If you want month-to-month, you want traditional service. And yes, you can get it without a deposit. For a deeper comparison, see our prepaid vs traditional guide.
Can you actually get month-to-month with no deposit?
Yes. Many people do. Here's why it works:
Every light company in Texas sets its own credit threshold for deposits. One company might require a deposit at a 580 credit score. Another says yes at 550. A third doesn't care until you're below 500. These thresholds change constantly based on each company's business needs.
The problem? You don't know which company will say yes until you apply. And applying one at a time takes hours: calling, sitting on hold, dealing with overseas call centers, getting quoted deposits over and over. That's where we come in.
How we find your no-deposit option
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1
You enter your ZIP code
We see which light companies serve your area.
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2
You pick a plan
If that company needs a deposit, we ask: want us to check others?
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3
We check multiple companies at once
Instead of you calling 6+ companies one at a time, we check them simultaneously.
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4
You see who says yes
Many people find at least one company that approves them with $0 deposit.
We can't promise $0 deposit. Every situation is different. But we can tell you this: plenty of people who expected to pay a deposit didn't have to. It's worth checking before you give up and go prepaid.
Other ways to skip the deposit
Beyond our multi-company check, Texas has built-in paths to no-deposit service:
- • Letter of credit: 12 months of on-time payments from a previous light company. Any company must accept it in place of a credit check. Learn more
- • PUCT deposit waivers: If you're on SNAP, Medicaid, SSI, or TANF, light companies cannot require a deposit. It's Texas law. PUCT §25.24
- • Age 65+: Seniors also qualify for deposit waivers under PUCT rules.
For a full breakdown of deposit rules and how they work, see our deposits explained guide.
Which light companies offer month-to-month plans?
Most major Texas light companies have a no-contract option. Here are some of the most common:
Reliant Energy
Offers month-to-month variable plans. Good customer service reputation. Rates adjust monthly based on market conditions. No early termination fee since there's no contract to terminate.
TXU Energy
Their Flex plans are billed monthly with no lock-in. Largest light company in Texas. Also offers short-term fixed options if you want a slightly lower rate with minimal commitment.
4Change Energy
Offers a 60-day satisfaction guarantee. If you don't like it, leave within 60 days with no fee. Not technically month-to-month, but gives you a similar freedom to exit.
Other Options
Green Mountain, Frontier Utilities, Chariot Energy, and others also offer short-term or no-contract plans. Availability depends on your area. Enter your ZIP code to see what's available where you live.
See month-to-month plans in your area:
Texas ZIP codes only. We'll show you no-deposit plans in your area.
The trade-off: month-to-month rates vs fixed rates
Month-to-month freedom comes with a price. Here's what the math actually looks like:
Typical cost comparison (1,000 usage/month)
12-month fixed plan
Lowest rate, locked in for a year
~$110-130/mo
3-6 month fixed plan
Middle ground: shorter commitment, decent rate
~$120-145/mo
Month-to-month variable
Full flexibility, rate changes monthly
~$140-165/mo
Prepaid (pay-as-you-go)
No credit check, highest cost
~$180-220/mo
Month-to-month runs roughly $20-40 more per month than a 12-month fixed plan. That's $240-480 per year for the freedom to leave anytime. Whether that's worth it depends on your situation.
The middle-ground move
If you're nervous about a 12-month commitment but don't want the highest rates, look at 3-month or 6-month fixed plans. You get a lower rate than month-to-month, and you're only committed for a few months. If things change, you're out soon enough. It's the sweet spot between cost and flexibility.
No matter which option you choose, traditional month-to-month is still significantly cheaper than prepaid. If you're currently on prepaid and paying $180-220/month, switching to month-to-month traditional service could save you $40-80 every month. That adds up to $480-960 a year back in your pocket. For the full comparison, see our prepaid vs traditional guide.
If you can't get traditional: what to do next
We're not going to pretend everyone gets approved for traditional service. If every company you check requires a deposit, and you don't qualify for a PUCT waiver, here's the honest picture:
Option 1: Pay the deposit
If one company has a lower deposit than others, it might be worth paying it. Deposits are refundable after 12 months of on-time payments. Some companies let you split it over a few months too. It's money you'll get back.
Option 2: Start with prepaid, build your way out
Prepaid costs more per month, but it requires no credit check and no deposit. The $40-75 to start is not a deposit. It goes straight toward your usage. Think of it like putting gas in the car: you're paying for what you'll use, not losing money.
After 12 months of on-time prepaid payments, you can get a letter of credit that forces any traditional light company to approve you with no deposit. That's your bridge from prepaid to the month-to-month plan you actually want. Our path to traditional guide walks through the full process.
Option 3: Check for PUCT waivers
If you're on SNAP, Medicaid, SSI, TANF, or you're 65+, light companies are required by law to waive your deposit. PUCT §25.24 It doesn't matter what your credit score looks like. If you qualify for one of those programs, you qualify for no-deposit traditional service. Period. See our traditional no-deposit guide for the full breakdown.
The bottom line
Month-to-month lights with no deposit exist. They're real traditional plans with normal billing, no long-term contract, and no $300 upfront. The catch: you need to find a light company whose credit threshold works for your situation. That's exactly what we help with.
Your action plan:
- Enter your ZIP code to see which light companies serve your area
- Pick a month-to-month or short-term plan that fits your budget
- If a deposit comes up, let us check other companies for you
- Many people find at least one $0 deposit option
- If traditional doesn't work out, prepaid gets you lights today
Ready to find your plan?
Texas ZIP codes only. We'll show you no-deposit plans in your area.
Consumer Advocate
I help you get your lights on when other companies say no. If you've been denied or quoted a huge deposit, I know the workarounds.
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