How prepaying for your energy can put you back in control

Prepaying for your energy has gained popularity throughout the cost of living crisis as a way for households to avoid bill shocks and take back control of their energy usage and spend. 

Smart pay-as-you-go (PAYG) energy meters allow users to pay for their energy - be it gas or electricity or both - upfront, eliminating the need for monthly or quarterly bills. Instead, users top up their energy via their supplier’s smartphone app, over the phone or online. Of course, understanding how smart prepayment works is crucial if you're considering using this method of payment.

To help you make an informed decision, we demystify smart pay-as-you-go energy with the help of Utilita Energy.

How smart pay-as-you-go works

PAYG, also known as prepayment, is a way for you to pay for your domestic energy usage. Meaning, you pay in advance for your energy consumption before using it. To track your usage, you would need a smart meter in pay-as-you-go mode. You may already have a smart meter in credit mode. If this is the case, contact your supplier and ask to be switched to PAYG. Then, you will be able to easily top up online, via your supplier’s app on a smart device or over the phone. 

Read also: Ways to reduce consumption and cut energy costs in your home

The basics to remember

• Allow you to pay for energy upfront, so you can budget more easily

• PAYG meters allow you to monitor your usage more carefully

• Top up when needed via app, phone or online

• Method offers flexibility and control over your energy expenses

How do traditional (non-smart) PAYG meters work?

More traditional, non-smart prepay meters are topped up via a compatible key or card, which can be loaded with credit at PayZone or Paypoint locations. However, switching to a smart PAYG meter makes topping up a lot easier as you can top up online at the tap of a finger.

Switching to smart PAYG energy

If you’re new to pay-as-you-go-energy, it’s a very simple process for your supplier to switch you from credit mode to PAYG mode if you have a smart meter. However, if you have a traditional card or key meter, you need to request a smart meter install from your supplier. The engineer will then do everything else for you, including installing your In Home Display (the screen you can see your energy usage on) and helping you to download your supplier’s app.

Once everything’s in working order, you can make your first top up. 

With Utilita Energy, for example, you would create a My Utilita account where you can top-up and make payments on the go, as well as view your energy balance and, in turn, spend more closely.

A step-by-step guide to getting started

To get started as a PAYG customer with a smart meter, follow these easy steps:

1. Contact your supplier and request to become a PAYG customer

   • If your existing meter is smart, this can be done remotely

   • If it’s a legacy key or credit meter, installation will be necessary

2. The engineer will connect your In Home Display (IHD) to your WiFi network and help you download your supplier’s app and connect your account

3. Then, top up your meter for the first time

4. Familiarise yourself with how to activate Emergency Credit should you need it and understand how Friendly Credit works and when

5. Set up low credit alerts to avoid forgetting to top up

6. Enjoy the ability to monitor your energy usage and spend

Tips for managing your pay-as-you-go account

Checking your account regularly can help you stay on top of your energy usage. Set up alerts from your provider’s app on your smartphone or device to track your balance easily.

It would also be beneficial to explore energy efficient tips and advice to help make your energy spend go further to maximise your budget. For example, turning The Big Light off when you don't need it. You may even want to consider savings functionalities, like with Utilita Energy, that help you to prepare and budget for the colder months over winter. 

How to top-up your smart PAYG energy meter

Thankfully, as a smart PAYG customer, topping up is simple. For example, with Utilita Energy, there are three ways to top up conveniently, no matter where you are:

1. Top-up via an app (from £2)

2. Top-up online and follow the steps

3. Or call directly with your unique top-up number associated with your account

How to get Emergency Credit as a pay-as-you-go customer

To access Emergency Credit, consult your meter manual or contact your energy provider. Typically, you can access Emergency Credit by pressing a specific button on the meter. Remember to repay the credit when you next top up to avoid any disruptions in service. For example, Utilita Energy offers up to £15 Emergency Credit per meter if you're struggling to top-up.

Alternatively, all energy providers must offer Friendly Credit to smart PAYG customers during certain periods, like overnight, weekends, and Bank Holidays. This can provide temporary relief for those who are unable to top-up their meters.

Maximising the benefits of pay-as-you-go energy

• For a typical user, smart PAYG energy is the cheapest, default tariff 

• You pay for your energy upfront, making it easier to budget 

• You only pay for the energy you use 

• Helps you to anticipate costs and avoid bill shocks

• You have access to more Emergency Credit than non-smart PAYG customers and can also access Friendly Credit 

• Top up anytime, anywhere via your supplier’s mobile app 

• Get insights into your usage to help cut energy waste and, in turn, your spend

• Receive low credit alerts to avoid running out of credit

Potential issues as a pay-as-you-go customer

There’s only one real issue as a PAYG customer, but it can be avoided with some forward planning: running out of credit. Of course, to avoid this happening, you can set up alerts so you don’t forget to top up. In fact, your supplier’s app - like Utilita Energy - will even give you low credit alerts automatically so you can top up in time. 

Other things to remember is that whilst PAYG is the cheapest default tariff, sometimes called Standard Variable Tariff, some fixed Direct Debit deals might be cheaper. So, it’s always worth looking at the various options available. 

Finally, if you have a non-smart PAYG meter (ie you top up with a card or key), you might have difficulty topping-up during out of hours. With a smart meter, though, you can avoid this from happening. 

Switching to or from a smart PAYG energy meter

If you have a smart meter in credit mode, you should contact your supplier and ask to be put in prepay mode. But it’s worth mentioning that your supplier will need to run through some checks to make sure that you’re able to do this safely. 

If you have a non-smart credit or prepay meter already that you top up with a key or card, then ask your supplier to install a smart meter in PAYG mode. 

Can I switch energy suppliers with a PAYG meter?

It depends on the energy suppliers you’re switching between. It might be as simple as transferring your account and credit, but it’s always best to double check. 

So, contact your current supplier for details on the process. Ensure any outstanding balance is settled before making the switch to avoid issues. Research and compare tariffs offered by different suppliers to make an informed decision.

What happens if I move house with a pay-as-you-go meter?

If you move house and would like to continue with  pay-as-you-go energy, contact your supplier to arrange for your account to be transferred to the new property. You may need to settle any outstanding balance before disconnecting it. Ensure the new property has a compatible meter; otherwise, a technician may need to install one.

About Utilita

A REVOLUTIONARY PAYG EXPERIENCE. Utilita is the UK’s only energy supplier created to help households make their energy spend go further, by revolutionising the PAYG experience. By improving visibility and control through industry-leading digital technology, Utilita households have energy back in their hands.   

NO USE, NO CHARGE. Utilita is the ONLY energy supplier that DOES NOT apply a standing charge when households use no/low amounts of energy, based on principle. Instead, Utilita applies a two-tiered tariff. 

ONLY SUPPLIER TO LOOK YOU IN THE EYE. Utilita is the only energy supplier with 12 High Street Energy Hubs situated in UK town centres, enabling anyone - not just customers - to have conversations about their energy usage, affordability, and learn about ways to save energy at home. 

About the author

Rebecca Roberts is a writer, editor, and content marketing expert hailing from Leeds. Here at Mumsnet, she brings parents content designed to make life easier. Beyond her role as an editor here at Mumsnet, Rebecca can be found balancing life as a working mum of two toddlers and when she’s not at her desk, you’ll likely find her at a local playgroup, in a nearby coffee shop, or walking the dog.

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