No-deposit electricity in Texas: waivers, limits and prepaid rules

By the BillAnswers team · Updated November 3, 2026 · How we check facts

A Texas provider can ask for a deposit only if you cannot show satisfactory credit, and every provider must let you skip it if you are 65 or older and not behind on an electric account, or if you submit a family violence certification letter. Prepaid plans cannot require a security deposit at all, and the balance needed to start prepaid service is capped at $75 for a home, plus any utility fees.

When a provider can ask for a deposit

A provider may require a deposit before service starts only "if satisfactory credit cannot be demonstrated" (16 TAC 25.478(c)(1)). To decide, it may look at a consumer reporting agency or, with your permission, your payment history from any provider that served you in the last two years (16 TAC 25.478(a)(5)). If you are already a customer, it cannot ask for a first deposit unless you paid late more than once or were disconnected for nonpayment in the last 12 months (16 TAC 25.478(c)(3)).

Before you confirm an enrollment, the provider must disclose any deposit requirement and its estimated amount, or how it will be calculated (16 TAC 25.474(d)(5)(G)).

How many prepaid plans are listed

On November 3, 2026, the official Power to Choose plan list showed 25 prepaid plans among 945 plans in total (our count of the export; each plan listed once).

How much it can be

All deposits together cannot exceed the greater of one fifth of your estimated annual billing or your estimated bills for the next two months (16 TAC 25.478(e)(1)(A)). For a new customer, the estimate may use average home usage, and only charges in the terms of service count (16 TAC 25.478(e)(2)).

After 12 months you can ask for a recalculation on your actual usage. Power to Choose notes that some providers want the deposit in full on the first bill and some let you spread it over several months.

Two ways to skip the deposit with any provider

Every provider must treat you as having satisfactory credit, with no deposit, if either applies (16 TAC 25.478(a)(4)):

• You are 65 or older and not currently behind on any electric service account.
• You are a victim of family violence, as determined by a family violence center, treating medical personnel, law enforcement, a district or county attorney, the Attorney General, or a grantee of the Texas Equal Access to Justice Foundation. You show it with a certification letter developed by the Texas Council on Family Violence, which can be faxed straight to the provider's toll-free fax number.

The provider must tell you about both options in any notice that asks for a deposit. It may also offer other fair ways to show credit, but it does not have to.

Extra options with an affiliated provider or the Provider of Last Resort

If you sign up with the affiliated retail provider of your area or the Provider of Last Resort (POLR), the rule adds more ways to avoid a deposit (16 TAC 25.478(a)(3) and (c)(2)): a good payment history (a customer of any provider in the past two years, not behind, and late no more than once in the last 12 months), a satisfactory credit rating, or qualifying as medically indigent. These providers must also offer a written letter of guarantee from another person instead of a cash deposit.

If you pay a deposit: interest and refund

• Interest. At least the yearly rate the PUCT sets by December 1 of the prior year; none is owed if the deposit is returned within 30 days. It is paid yearly if you ask, or when the deposit is returned (16 TAC 25.478(f)).
• Receipt. The provider must give you a receipt or show the deposit on your bill (16 TAC 25.478(h)(2)).
• Refund. After 12 consecutive residential bills paid with no late payments, the deposit must be refunded, possibly as a bill credit (16 TAC 25.478(j)(1)).
• When you leave. The old provider transfers the deposit plus interest to your new provider or refunds it to you, minus anything you still owe (16 TAC 25.478(j)(2)).

Prepaid: no deposit, different rules

Prepaid ("pay as you go") plans may not require a security deposit (16 TAC 25.498(c)(11)). You pay ahead and get no monthly bill. These are the main protections:

Before you choose prepaid, know these points from the rule and Power to Choose:

• Service "may be disconnected with little notice" if your balance falls below the disconnection level, so you need a phone or email that reliably gets the warnings.
• Some assistance agencies may not help prepaid customers.
• Prepaid plans "generally charge a higher rate than non-prepaid plans," says Power to Choose. Compare the Electricity Facts Label of a prepaid plan against regular plans in the true-cost calculator.
• A provider may not knowingly give prepaid service to a critical care or chronic condition residential customer. Moving such a customer to regular service must be free, with no early termination fee (16 TAC 25.498(k)).
• No fee to switch away from prepaid or to move to regular postpaid service, but a disclosed early termination fee can still apply, and the postpaid plan may require a deposit.
• A provider may not require, or agree with a landlord to require, that a tenant choose it as a lease condition.

How to decide

1. If you qualify for the 65-and-older or family violence waiver, say so before any deposit is set.
2. Ask each provider for its deposit amount before you confirm.
3. Compare a regular plan plus its deposit against a prepaid plan at your own usage. The deposit comes back with interest; a higher prepaid price does not.
4. If you are moving, see setting up electricity at a new address.

Last updated: November 3, 2026