Are you one of the estimated 5.9 million households in the UK that are currently paying for your energy using a prepayment meter? Let’s take a look at what this means…
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What is a Prepayment Meter?
Prepayment meters, also known as top-up, key, or pay-as-you-go meters, are a type of domestic energy meter that requires customers to pay for energy before using it.
Users are able to top-up the meter by adding funds to a key, top-up card or online app (the latter applies to smart prepayment users only). As energy is used, the credit on the meter depletes until it’s time to top up again. Users are able to track spend via the meter itself, or via the in-home display for smart prepayment users.
In the past, prepayment meters have had a bad name for leaving users ‘in the dark’, however the most up-to-date prepayment meters have an ’emergency credit’ button. The amount of emergency credit depends on the supplier, but this will allow you extra time to top-up in the event that your meter runs out. This means that the most vulnerable households aren’t left in the cold and dark – a ludicrous thought in this day and age.
Prepayment Meters Pros and Cons
|You’re in control and it’s easier to budget.||They are more expensive to operate than other meters.|
|Helps to prevent a large bill because you ‘pay as you go’.||Topping up at the shop can be an inconvenience.|
|It will avoid you getting in debt with your supplier.||If you are unable to top-up online or if your local shop has closed – you could be cut off!|
|Prepayment tariffs are becoming more competitive.||Prepayment tariffs are not as competitive as other energy tariffs.|
Who’s Suitable for Prepayment Meters?
On average, prepayment meters are more expensive to run. Despite this, there are certain cases where it could make sense to have one:
- Landlords who rent their properties to tenants – meaning tenants can’t leave until their energy bills are paid in full.
- Prepayment meters may help those that struggle to keep up with energy bills.
- If you have fallen into debt with your supplier, they may install a prepayment meter to help the customer budget their energy usage.
If you wanted a prepayment meter installed, contact your energy supplier and they will talk you through your options. Did you know that prepayment meter tariffs are £80 more expensive than direct debit tariffs, on average?
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Getting Your Prepayment Meter Replaced
If you’re looking to get rid of your prepayment meter, first, be sure that your energy account is debt-free and be ready for a credit check!
The supplier will usually run a credit check on you to help them decide if you’ll be able to keep up with payments. Depending on your credit score and account history, they could reject your request. Unfortunately, this means that you’ll have to stay on a prepayment tariff. You may be able to find a cheaper deal elsewhere if you compare prepayment tariffs.
If you pass the credit check, they will book an engineer to remove your old meter and install with a new one. The timescale will depend on the availability of the supplier and could be between anywhere from a few days to a few weeks.
If your supplier is one of the “Big Six“, you will not be charged a fee for installation but other terms and conditions may apply.
Every supplier will have their own rules and fees may be applied depending on the supplier. If your current supplier charges for replacement costs, however, then it may be worth switching to another supplier that will not charge you.