Prepayment Meter Systems
Effective Budgeting
Prepayment meter systems can be a useful way for cus-
tomers to budget, especially ones on a low income. Cus-
tomers pay in small amounts as they go, rather than
receiving a large bill every 2 months.
Up to date consumption feedback
Customers received up to date feedback as to their ener-
gy use, and therefore try to adjust their usage according-
ly. Customers gain an understanding on the importance
of conserving power within a short time through using a
prepayment meter system.
Energy costs can be shared
Prepayment meter systems provide an opportunity for
the burden of energy costs to be shared by people living
in the house, rather than falling onto one person’s name.
Short term visitors, roommates or family members can all
pitch in by purchasing recharge cards and contribute to
power costs.
Preventing arrears, credit action and reconnec-
tion costs
Customers cannot build up high arrears, which are then
difficult to pay, and can result in debt collection action
and credit defaulting listing.
Customers avoid additional fees such as disconnection
and reconnection costs
ADVANTAGES
Prepayment Meter Systems
Introduction
Rising electricity prices have made customers increasingly aware of the importance of monitoring and
controlling their energy use.
In Coober Pedy, residential electricity bills are issued every 2 months after the consumption of elec-
tricity takes place. This means there is a significant delay for the customer receiving feedback as to
how much electricity they are using, and gives little opportunity for the customer to adjust their be-
haviour if their usage is higher than expected. A customer may have forgotten that their consumption
of electricity may have been higher due to an extended period of hot weather during the summer
months.
Many people are familiar with the concept of prepaid mobile phones. These mobile phone plans are
an effective way of safeguarding against unexpectedly high phone bills. A prepayment meter system
would work in a similar fashion as a prepaid mobile, and would be an effective way of controlling the
amount of energy consumption and debt that a customer incurs.
What is a prepayment meter system?
A prepayment energy meter is a type of domestic energy meter that requires the customer to pay for
energy before they use it, similar to a prepaid mobile. This is done via a smartcard, token or key that
can be ‘topped up’ at a local store or via a smartphone app.
How does a prepayment meter system work?
A prepayment meter is like a prepaid mobile phone, where as you have to pay for your electricity
upfront before you can use it. You would have to top-up with credit to continue to use your
electricity.
Generally electrical retailers offer a smartcard, token or a key that can be topped-up at a shop or ‘one
use only’ tokens can be bought that are used to enter credit onto the prepayment meter system.
Some retailers offer a phone app on online option that allows the customer easily make payments at
any time of the day.
What happens if I run out of credit? A prepayment meter system will self-disconnect (turn off electricity to the property) if it runs out of
credit. A prepayment meter system will only disconnect power between the hours of 10am – 3pm on a
week day, it will not self-disconnect on a weekend.
Once credit is entered into a prepayment meter system it will instantly re-connect supply to the prop-
erty.
Prepayment meter systems are required to have an ‘Emergency Credit’ feature. This feature stores a
small amount of credit away so that can it be used if electricity is required after the prepayment sys-
tem runs out of credit. If this feature is used the prepayment meter system will re-connect electricity
supply to the property until this all the emergency credit is used.
If a prepayment meter has self-disconnected because it has run out of credit & emergency credit,
when credit is next added to the prepayment meter system it will take the pre-determined amount of
emergency credit from the added credit amount and store this away for the next time the emergency
credit feature is required.
Prepayment Meter Systems
Prepayment meter systems in other States &
Territories
Tasmania
Prepayment meters have been used in Tasmania since 1997. Customers can purchase an amount of
credit between $5 - $200 by taking their smart card to any Recharge Agent – generally newsagents, ser-
vice stations or supermarkets.
A standard amount of emergency credit in Tasmania is $18 that customers can use if they run out of
credit.
Northern Territory
A report project undertaken by Bushlight in 2013 noted that there were over 8500 prepayment meter
systems in the Northern Territory. These systems are mostly used in Indigenous communities, town
camps and public housing.
Payment is made by a single use cardboard card with a magnetic strip purchased at a local store. Card
values varied between $5 and $50. The amount of emergency credit used in the NT is between $5 and
$10.
Causing disadvantage from self-disconnection
Customers that lose supply when they cannot afford to
buy credit may experience personal/household disad-
vantage (food spoilage, no heating/cooling, lighting, hot
water etc) until they are able to afford to purchase addi-
tion credit
Reducing disconnection visibility
Customers may have to keep checking the balance of
credit remaining on the meter, or risk the chance of self-
disconnection
Payment challenges
For some low income customers, there may be resistance
in paying in advance for electricity, seeing this as a bene-
fit to the DCCP rather than to themselves
Customers without internet access or a mobile phone
may only have limited options for purchasing credit
Where credit is purchased via tokens or ‘single use only’
cards, access to the recharge points may not be conven-
ient – they may not be open at all hours or the customer
may not have a vehicle to get to recharge points which
could be hazardous during the hot summer months
DISADVANTAGES
ENTERPRISE MANAGEMENT SERVICES
Prepayment meter systems in other countries
New Zealand
Prepayment meter systems have been used in New Zealand for a number of years. One popular retail-
er Glo-Bug offers a system with an In-Home Display (IHD) to assist with monitoring power consump-
tion. It does this by changing colour depending on the amount of credit remaining on the prepayment
meter system:
Green means there is more than $10 credit remaining
Orange means there is less than $10 credit remaining and the prepayment meter system will self-
disconnect at midday the following day if not topped up
Red is an urgent warning that means supply will be disconnected at midday that day. Once the
power is disconnected the system no longer displays a colour.
United Kingdom
It is estimated that there are 4 million people in the UK that use a prepayment meter system. Custom-
ers use a token, key or smart card to add credit which can be purchased or topped up at their local
store.
Prepayment meter systems are common in rental properties in the United Kingdom.
South Africa
By 2000, approximately 3.2 million prepayment meter systems were installed in South Africa. They are
used with a once only use token with a magnetic strip that is entered into the prepayment meter,
alike a bus ticket or they have a 16 or 20 digit code that has to be manually entered into the keypad on
the face of the meter.
Prepayment Meter Systems
Prepayment meter systems have proved to be successful for energy
customers all over the world. There is evidence to suggest that cus-
tomers who choose to use to a prepayment meter system over a tradi-
tional energy meter, will have greater control over their energy usage
and energy costs.
This lends itself to customers, especially those on low income, being
able to better manage their budgets and share their energy cost
throughout the household.
As the price of energy doesn’t look to be decreasing in the near dis-
tant future, prepayment meter systems may prove to be a great solu-
tion for both retailer and electricity customers in providing a sustain-
able and affordable source of electricity.
Conclusion
District Council of Coober Pedy Hutchison Street Coober Pedy, SA 5723
Ph: 0886 724 600 Fax: 0886 715 699 Email: [email protected]
www.cooberpedy.sa.gov.au
Prepayment Meter Systems