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Original poster

Can someone explain prepayment meters to me

26 replies

BleurghUna · 23/08/2011 18:00

Thought these were designed to help people budget for their fuel payments throghout the year, by paying the same amount into a meter every month. But I have read a lot of threads on here by people with meters saying they are worried about their winter fuel bills. Surely if they are prepaying for their fuel they won't get a bill? Or am I misunderstanding?
WE pay for our fuel by monthly direct debit, duel fuel, online, this si supposed to be the cheapest way, so why doesn't everyone do this, especially those who are struggling financially?

OP posts:
littleducks · 23/08/2011 18:14

You pay for elec/gas via a card or key but when the money runs out the gas/elec stops!

iklboo · 23/08/2011 18:36

Not everyone has enough money up front every month to pay a direct debit & some people have bank accounts that don't pay out direct debits. You don't pay a set amount per month on a pre pay meter, you pay for what you use, when you use it. If it's a 'heavy' month, you could run out of money on the meter and not have any money to buy more IYSWIM.

Thehusbandsatcricketagain · 23/08/2011 18:56

the onlything to be said about them is they rob you blind,elec/gas is priced more expensively.I have a monthly dd with mine,pay same amount throughout year,easy to budget & never run out oor have to worry

Original poster
BleurghUna · 23/08/2011 19:07

Thanks both - I was wondering if prepayment meters were cheaper than direct debit, but it doesn't look as if they would be, and they definietely sound more inconvenient. I think I will stick with direct debit duel fuel and wearing lots of woolly jumpers for now!

Iklboo - I am surprised that not all bank accounts allow direct debits. You can save a lot and budget better by having direct debits, I can't understand why a bank wouldn't let you do this, especially as it's all done electronically now.

OP posts:
LawrieMarlow · 23/08/2011 19:13

I have a basic bank account (have to due to financial problems) and it has direct Debits. No overdraft or cheques but has debit card and can do everything I need to.

I thought sometimes if people have gone into arrears that they have to have a prepayment meter and that the cost per unit is more. Seems unfair.

CokeFan · 23/08/2011 19:14

On some prepayment meters there's also a daily charge, so you still pay even if you don't use any electricity/gas.

mumatron · 23/08/2011 19:20

Don't assume pp metetrs are more expensive! That is largely a myth these days. Call your current supplier and ask for the unit prices for both meters.

A lot of people will actually find pp cheaper as it makes them very aware of what they use on a daily/weekly basis. They will budget much better when they can see exactly how the credit is going down.

I work for a utility company, in a prepayment based department so I know a fair bit about them.

KenDoddsDadsDog · 23/08/2011 19:26

PPMs on the whole mean you can't benefit from price fix products. So when prices go up then so do PPMs. Most suppliers give a discount for dual fuel DD so you will be benefiting from that.
They can be a better option but not always.

mumatron · 23/08/2011 19:30

Yes as ken says you won't benefit from any duel fuel deals or direct debit discounts etc.

Original poster
BleurghUna · 23/08/2011 20:23

Well we get 3 discounts: one for dual fuel, one for DD and one for online (no paper bills) so I think that is probaly the best for us. Thanks for all your posts!

OP posts:
Grumpla · 23/08/2011 20:29

I found PP meter quite a lot more expensive that was about 7 years ago though. Also NOT very convenient having to schlep to the shops to top it up before you can finish cooking your tea!

Original poster
BleurghUna · 23/08/2011 22:37

Grumpla Shock So if it's more expensive and you don't get any discounts, and you hae to dash to the shops to top it up, what's the point? Why don't you just go on a normal tarriff?
Off to bed now - will catch up tomorrow.

OP posts:
Naoko · 23/08/2011 23:27

I'm in a rented house with a prepayment meter. My landlord won't let me remove it. Many are the same - probably due to do with the risk of people moving out without paying the bill. I understand it, I guess, but it's a pain in the neck. At least this one is an improvement over the one we had in a previous rented house - here, if it runs out over a weekend (when shops you can top it up in aren't open) it doesn't actually turn the power off till Monday morning, and takes the money for that out of the next top-up. The one we had in the other place had the usual £5 emergency credit, but if that ran out (very quick to do, was a 6 bed student house!) that was that, even if it's 2am on a saturday night.

And yes I am worried about this winter - last year we were putting in more than £30 a week when it was very cold. I expect it'll be more this year, if it gets that cold again.

RedSpike · 24/08/2011 00:44

Companies are no longer allowed to charge a premium for pre-payment meters but they can charge for real metering costs which are higher than other billing sytems - or so they argue, which means they can still inflate the tariff and usually do.

belledechocchipcookie · 24/08/2011 01:18

It's more expensive, they usually smack on a 'standing charge' also. Don't do it! Stick some money aside for the bill.

Wabbit · 24/08/2011 01:40

If you have a PPM and wish to change to paying DD monthly, the company will run a credit check on you to see if you are 'good' for the DD payments, many people have financial issues that affect their credit status, especially those who have been unable to pay a bill in the past and have resolved the issue by having a PPM installed, (they can be 'set' to recoup a debt). Also, the customer has to pay (something in the region of £50) to get each meter swapped back to non PP

Original poster
BleurghUna · 24/08/2011 13:04

Oh dear that doesnn't sound very good! I always imagined a meter would be more hi-tech and easier to use nowadays, probably cheaper too as you could see how much you were using, how much you had used this week, this month etc. But I don't think there would be any advantage for us in changing to the sort of meter you describe on this thread.
What an inconvenience having to leave the house to top it up!
Maybe I am confusing with Smart meters? Anybody know about those? Maybe I should start another thread?
Thanks anyway

OP posts:
mumatron · 24/08/2011 13:44

Smart meters are what most suppliers will be installing in the near future. I know a bit about them, they can be topped up remotely but not all suppliers offer this either.

Original poster
BleurghUna · 24/08/2011 18:57

Yes I think smart meters are what I meant! Doh! Will everyone get one automatically? Will it cost any extra?

OP posts:
RedSpike · 24/08/2011 21:15

Smart meters will record your electricty usage every half hour - you will be charged more for using electricity at peak times.

Theoretically you can reduce your bills by using power during off peak...if you can be flexible. Currently smart meters are only offered by a few companies but the National programme to install to every household will start 2014 and finish 2019. You many find that due to the limited number of companies offering smart meters before 2014 the market isn't as competitive as you would hope, so you may be better off sticking with the old fashioned meter until the official rolls out in 2014.

mumatron · 24/08/2011 21:20

smart meters will be installed as standard in future i think. not only for pp but billing meters too.

there's loads of tech being developed atm, things we wont see for years yet.

wrt to costing more, I can can only say what we propose to do as a company. Our current smart meter customers (trial basis atm) pay the same as customer on key meters. they are also provided with something like <a class="break-all" href="http://www.google.co.uk/imgres?q=electricity+monitor&hl=en&sa=X&biw=1138&bih=587&tbm=isch&tbnid=nrqr0btt1rJZtM:&imgrefurl=www.isawitonthebox.com/uncategorized/first-utility-and-wireless-electricity-monitor-or-smart-meter-as-seen-on-the-one-show&docid=0Mm1MCQQSBkI8M&w=280&h=280&ei=JltVTpGGM4zNswaK9IAe&zoom=1&iact=hc&vpx=170&vpy=251&dur=3810&hovh=224&hovw=224&tx=133&ty=115&page=2&tbnh=126&tbnw=126&start=10&ndsp=18&ved=1t:429,r:0,s:10" rel="nofollow" target="_blank">this that shows exactly what is being used. It has a coloured light on the side that shows green when you're within a 'normal' usage level, amber as you use more (boil kettle, for example) and red for high usage (tumble drier)

Imo it is the monitor that really helps with saving money. if you are on a billing meter see if your supplier provides a tariff like iplan the monitor on this one allows you to set limits on your usage. your electricity wont cut out when you reach that limit but it will warn you iyswim. this would 100% be cheaper than a ppm.

see what your supplier offers, i think they all have a monitor based tariff of some sort. beware though they may not be available with fixed price tariffs.

mumatron · 24/08/2011 21:23

this would 100% be cheaper than a ppm.

that sentence should have been deleted! sorry!

Original poster
BleurghUna · 25/08/2011 13:04

Thanks mumatron.
Can I ask what supplier you work for? We are with Eon. We tried to join their smart meter pilot scheme but it was oversubsribed.

OP posts:
sheepgomeep · 26/08/2011 20:24

If you live in a council house then you have no choice but to have a prepayment meter (in most council properties anyway)

I have enquired about going on to direct debit but no go.

mumatron · 26/08/2011 20:28

sheepis that the council saying that or your supplier? Not something i've come across.