What are the advantages and disadvantages of prepayment meters?

Prepayment meters can be a useful tool for managing your energy costs. As the name suggests they require you to pay for your energy in advance. With a prepayment meter it’s much easier to avoid building up a debt for your gas and electricity.

Below we’ve put together a list of pros and cons of having one:

Advantages of prepayment meters

  • You’re in control of how much and how often you top up.
  • You don’t have to worry about building up debt as you purchase your energy before you use it making you more aware of your running energy costs.
  • You always have an idea of what your remaining balance is as it’s displayed clearly on the meter screen which helps you avoid nasty surprises.
  • You don’t receive any bills, you pay in advance.
  • Prepayment meters will have an ‘Emergency Credit’ facility which offers a set amount of extra credit in case you run out of your pre-paid credit, giving you time to top-up your meter before you would lose supply.
  • Prepayment electricity meters have a Friendly Credit or ‘no-disconnect’ mode that operates at certain hours of the day and/or night. In these hours, considered to be the most inconvenient times to be without energy, you will not lose supply even if Emergency Credit has not been activated or it has run out.
  • You can use your prepayment meter to repay any outstanding money you owe us. Your payments are spread over a time period that suits you, in agreed amounts that you can afford, interest-free.

Disadvantages of Prepayment meters

  • Prepayment meters are more expensive to operate than other types of meter which means you might not be able to access the cheapest tariffs available 
  • Topping up at a local newsagent, petrol station or supermarket is inconvenient (especially when it’s cold)
  • If your prepayment meter has run out of credit and your supply is off, to restore your supply you will need to access your meters directly which may be positioned out of easy reach.
  • Your supply will turn off if your prepayment meter runs out of credit outside of ‘Friendly Credit’ hours, and your ‘Emergency Credit’ has been used or has not been activated. It may not be possible to restore your supply until your meter is topped-up again and is in positive credit.
  • If your prepayment meter has run out of credit and your supply is off, you may need to repay any ‘Emergency Credit’, ‘Friendly Credit’ or any outstanding amount owed, before your supply will come back on. You may also need to account for any debt repayment plan that has been agreed. This could mean you need to top-up a bit more than you usually would so please be aware this may affect your budgeting.
  • Your energy usage will almost certainly increase during winter months; meaning your weekly top-ups would also have to increase. When you ‘pay-as-you-go’ this may be even more noticeable and have greater impact on your daily and weekly budgeting. It may help to spread out your payments evenly over the year to build up credit during the summer months, ready for the winter.
  • If you leave home for several days, you must remember to charge your key or card, and to credit your meter. This is because your credit is used to pay for your daily standing charge (on selected tariffs) and any debt repayments – so if you don’t charge your meter enough before going away, appliances that you may want to have on all the time (for example, freezers) may switch off.