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What Are Prepayment Meters?

Imagine paying for your energy before you actually use it. Thanks to prepayment meters, you can! This type of energy meter, also known as a pay-as-you-go meter, operates much like a pay-as-you-go phone bill. You simply top up your credit and energy is readily available for you to use.

This payment method offers an effective means of managing your energy consumption, and it’s no wonder that around four million people in the UK are already reaping the benefits.

But how does this actually work? What are the advantages and disadvantages? And most importantly, can they help you reduce your energy expenses? We cover all this and more below!

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What Is A Prepayment Meter And How Does It Work?

A prepayment meter, also referred to as a pay-as-you-go meter, is a type of domestic energy meter that allows you to pay for your energy upfront before you use it. Gone are the days of anxiously awaiting monthly energy bills. With this system, you have the flexibility to adjust your energy spending on your own terms.

With a pay-as-you-go meter installed in your home, you can easily purchase credit from your local shop or post office with a specific key or card. Once the credit is added to your account, your prepayment meter starts using it to cover your energy usage. As expected, the more energy you consume, the faster your credit runs out.

Prepayment meters also include standing charges, meaning a portion of your credit will cover this even if you’re not actively consuming power.

The specific charges associated with these meters can vary depending on your region, chosen tariff, and energy supplier.

Can I Switch To A Cheaper Prepayment Energy Plan?

Almost every energy supplier has a range of prepayment meter tariffs available. Just like regular meters, some plans are cheaper than others. It’s definitely worth checking if you can switch to a different pay-as-you-go plan and save money.

To compare prepayment meter tariffs with ease, you can head over to Business Energy Comparison. While switching options may be limited due to the current UK energy crisis, we can still help you compare today’s business utility prices from leading suppliers and get free quotes in minutes.

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If you currently have a prepayment meter but wish to switch to a direct debit meter, it is indeed possible, provided you meet specific requirements. Here’s what you need to know about switching your meter type:

  • Inherited prepayment meter: If you’ve bought a property with a pay-as-you-go meter, inform your energy supplier about changing it. They should assist you in making the transition to a credit meter. Just be aware that they may conduct a credit check as part of the process.
  • Past billing issues: If you’ve had trouble with energy bills in the past but have resolved them, there is the possibility to switch. To change, you will typically have a credit check so ensure your account is completely debt-free.
  • Meter change fees: It’s wise to check with your energy provider regarding any fees associated with changing meters. Some suppliers may charge a fee for the switch, others may not. Be sure to take the time to explore various offerings.
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Why Does My Home Have A Prepayment Meter?

Your home may have a prepayment meter for a number of reasons.

Firstly, the property may have already had one installed. This could have been a deliberate choice made by the previous homeowner or the property owner to make it easier for them to budget and keep tabs on their energy costs.

Additionally, if you’re renting, your landlord may have chosen to install this meter type to avoid issues with unpaid energy bills. There is less risk for the landlord and fewer worries about unpaid debts with a pay-as-you-go setup.

Occasionally, energy providers may install one if you’ve had trouble paying your energy bills in the past. This arrangement enables homeowners to gradually repay outstanding debt in smaller increments, as part of each payment made towards the meter.

How To Take A Prepayment Meter Reading

Keeping track of your energy usage is still important, even for prepayment meter customers. While you don’t need to submit readings for accurate billing, it can be helpful to monitor your energy consumption.

To check your electricity prepayment meter:

  • Insert your electricity key into the meter and press the blue button. This will switch the display from showing your remaining credit to displaying the actual reading.
  • From here, you can just take a reading as you would with a regular meter.

To check your gas prepayment meter:

  • Insert your gas card into the meter. This will beep once and then show how much credit is on the card.
  • Take your card out and press down on the red button marked ‘A’ until you hear another beep. Keep pressing ‘A’ to navigate through the screens.
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What Are The Pros And Cons Of Prepayment Meters?

When considering a pay-as-you-go meter, it’s important to weigh the advantages and disadvantages. While there are several benefits, there are also a few factors to be aware of.

Pros of a prepayment meter

  • You have full control over how much energy you use and how you pay your energy bill.
  • You won’t receive any large and unexpected bills.
  • They can help you pay back outstanding debt.
  • Unless you owe a certain amount of money to your supplier, you have the freedom to switch from a prepayment meter at any time.

Cons of a prepayment meter

  • These meters are expensive and typically have higher energy costs per unit compared to other energy tariff options.
  • There is a possibility of running low or out of credit at inconvenient times, such as when your local shop or post office is closed.
  • Your energy supply may be cut off when you exhaust your current credit allowance, leaving you without power until you can top up again.
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I’ve Moved Into A House With A Prepayment Meter – What Should I Do?

If your new home is equipped with a prepayment meter, here’s what you should do:

  1. Contact the current supplier: Don’t use a key or card or add any money to the meter until you’ve contacted them and registered as the new account holder. By doing so, you can ensure you’re billed correctly and avoid paying for any outstanding debts left by the previous occupants.
  2. Confirm meter reset: When contacting your energy supplier, inquire whether the meter needs to be reset for your occupancy or if you need a completely new key or card.
  3. Compare energy tariffs: Take the opportunity to compare different tariffs with your supplier to find one that’s best suited for your energy needs.

Smart Prepayment Meter

Thanks to advancements in technology, the introduction of smart prepayment meters has made topping up even more convenient. With the option to use a smartphone app or online platform, you can easily manage your energy credit from the comfort of your own home.

Much like a regular smart meter, a smart prepayment meter provides you with real-time access to your energy usage information through an in-home display. This allows you to monitor and manage your home and business gas and electricity consumption more effectively, ultimately leading to reduced usage and increased savings.

With the advantages of real-time information, convenient online top-ups, and proactive credit monitoring, smart prepayment meters offer an enhanced energy management experience for UK households.

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Compare Energy Prices With Business Energy Comparison

Ready to unlock the power of savings for your business? Then it’s time you compare energy prices with the help of our brokers and consultants at Business Energy Comparison. We’ve made it effortless to find the perfect energy deals for your business, whether you’re an SME or a large business.

By comparing leading UK suppliers, we ensure you get the most competitive rates for both your business electricity and gas.

Visit us today and start comparing to find your perfect energy solution!

Frequently Asked Questions

Can I switch suppliers if I'm on a prepayment meter?

Yes, you can switch suppliers on a prepayment tariff. This is also possible if you’re in debt and owe less than £500 for gas and £500 for electricity.

How do you top-up your electricity and gas meter?

You can visit any of the 50,000+ locations across the UK, including Payzone, PayPoint, and the Post Office to top up your key or card. These locations typically operate seven days a week for your convenience.

What do I do if I can't top up my energy card or key?

If your meter runs low and you’re unable to top up, you can insert your card or key to access emergency credit. Although, you should only use emergency credit when necessary. If you encounter any difficulties with topping up, reach out to your energy provider for assistance.