Energy Guides

Electricity bills: 4 reasons to love your prepayment meter

Thursday 9 December, 2010

By Becca Talbot - becca@consumerchoices.co.uk

Despite prepayment customers paying higher gas and electricity rates than other customers, Becca Talbot outlines why prepay meters could be the perfect way to pay for your energy.

Prepayment meters allow you to pay for your gas and electricity as you use it. They are usually installed by your energy supplier if it feels you are unable to keep on top of your payments or if you owe it a lot of money. Anyone can request to have one fitted though, and you may find it’s the right energy payment method for you.

Figures from fuel poverty charity National Energy Action (NEA) reveal there are nearly 6 million prepayment meters in British homes. Prepayment meters are not ideal for everyone however, as they are one of the most expensive ways of paying for your energy. It’s well-known that energy providers charge prepayment meter customers higher rates for their gas and electricity, and NEA is just one group that is campaigning for the disparity between credit and prepay meter customers’ energy prices to be stamped out.

If you are considering ditching your standard meter though, here are five top reasons why a prepayment meter could be right for you:

1. The ultimate budgeting tool

Prepayment meters are great for anyone who wants to budget, as you’re able to top-up your electricity key with however much you’d like, when it’s convenient for you.

Energy charity NEA says that consumers “like the discipline of controlled expenditure and the avoidance of unexpectedly high bills”.

Prepayment energy may be perfect for you if:

• You are self employed/freelance, and your monthly income isn’t guaranteed
• You don’t have a bank account from which to make direct debits
• You prefer to pay for things with cash.

2. You’ll have fewer bills and less stress

Nobody likes paying bills, fact. So why not reduce the number you have to pay by paying for your electricity as and when you use it? Think of it as “pay-as-you-go energy”.

Because the average household has about 10 different bills to remember to pay each month, getting your electricity on a prepayment key could actually be a blessing. One less bill means one less direct debit, and one less thing to worry about.

3. An opportunity to get energy efficient

Using a prepayment meter instantly makes you more conscious of the amount of energy your using, and, in some cases, wasting.

Things such as turning lights off when you leave a room, switching your TV off at the socket instead of just flicking it on to standby with the remote, and even unplugging your mobile after its finished charging, all become routine as you endeavour to save your precious, costly electricity.

Because you can know how much energy costs you, you’ll change your habits and become more energy efficient almost without realising.

4. No more pesky meter readings

Meter reading is a thing of the past with prepayment meters - you won’t have to get down on your hands and knees and crawl into the cupboard under the stairs, fumbling with a torch and a pen.

And you’ll also never be bothered by pestering meter readers, who usually come knocking at your door at an inconvenient time.

But you will have to use your key to top-up your meter regularly.

But there is a downside to prepayment energy...

Of course there are plenty of very good reasons to avoid prepayment meters. Notably, running out of electricity at a most inconvenient time.

Just like the top-up on your phone, prepayment meters will run out of energy as you use it. And unlike standard credit meters, there is no certainty of constant electricity or gas to your house with a prepayment meter.

Imagine these scenarios, where a prepayment meter running out could cause problems, and you may reconsider your desire to have one installed:

• Being late for work because your radio alarm clock has not gone off
• Having to have a freezing cold shower because the “power shower” doesn’t work
• Having to throw away the entire contents of your fridge and freezer because they’ve gone off
• Missing your favourite TV programmes because your set-top box didn’t record
• Having to run to the corner shop late at night to top-up your prepayment electricity key.

Getting a prepayment meter isn’t for everyone, and if you’re considering having one installed you should think about it carefully. Having a prepayment meter removed again could cost you more money than it saves to have one installed.