Municipal utility districts: prepay option: termination of service

The law lets eligible districts suspend prepaid electric service when a customer’s balance runs out without using the usual delinquency-notice process. It requires disclosures, balance alerts, refund protections, and added policies for vulnerable customers.

What the law does ​

• Allows municipal utility districts serving fewer than 100,000 customers to offer residential prepaid electricity service.
• Allows districts to send required delinquency notices electronically, except for final termination-contact notices.
• Requires written, informed customer opt-in; access to usage and balance information; and a right to return to standard billing under district policy.
• Requires low-balance alerts at least 10 days and 24 hours before forecasted service suspension.
• Requires districts to offer customers in arrears a payment plan before converting them to prepaid service, subject to a voluntary conversion rule for customers whose deposits cover their delinquency.
• Requires refunds of unused prepaid balances within 10 business days after service ends and the final bill is paid.
• Requires prepaid funds for electricity not yet provided to be held in a separate fund and not spent or transferred.
• Exempts prepaid customers from the standard delinquency-notice requirements before electric service termination.

Who it affects ​

• Residential electricity customers of municipal utility districts serving fewer than 100,000 customers.
• Municipal utility districts that choose to offer prepaid electricity service.
• Older adults, medically vulnerable customers, and dependent adults enrolled in prepaid service.

Context ​

The law requires districts to adopt policies aimed at minimizing disruptions for older, medically vulnerable, and dependent-adult prepaid customers.