Prepayment Meters
For the Consumers
Advantages
- Helps the individual to monitor their spending on fuel
- No big bills to pay
Disadvantages
- Higher fuel tariffs mean that individuals pay more than other consumers for the same fuel
- Higher meter rental charges
- Possibility of self-disconnection
- Confusion regarding how to use / read the meter
- Charge cards pay for fuel used plus other items - meter rental, standing charge, debt, etc.
- Availability of outlets that sell the charge cards for the meters [especially in rural areas].
For the Fuel Supplier
Advantages
- Lower administration and billing costs
- Reduction in levels of enforced disconnection
- Payment is received before fuel is used
- The meter can be adjusted to recover any fuel debt
- Usage can be monitored, predicted, etc, therefore making future planning easier
- Less opportunity for fraud
Disadvantages
- Initial installation costs
- Organisation of outlets for meter cards, etc.
- Essential Facts
- 50% of electricity customers with prepayment meters are in social class D or E households
- 63% of gas customers with prepayment meters are in social class D or E households
- 59% of those with no bank account have a prepayment meter
- Those with a prepayment meter pay 9% more than those who pay by direct debit
- Those with a prepayment meter pay 5-6% more than those who pay by quarterly credit
- This can amount to an extra £160 per year difference between direct debit and prepayment meter customers
