Report shows popularity of prepaid electricity metering

A recent study issued by energy sector consultancy Distributed Energy Financial Group confirmed previous research that makes a connection between prepaid cards and greater energy savings for consumers. The DEFG report said that three out of four study respondents indicated that, since they switched to prepaid plans, they changed their energy usage habits to lower their energy bills.

DEFG said prepaid energy metering programs reduce overall energy usage by 5.5 percent to 14 percent. The study also noted that prepaid customers are satisfied with the service, at a 92 percent clip. These results suggest prepaid energy metering will continue to gain in popularity with electricity providers and consumers.

"Prepay service can enhance the relationship between the utility and its customers by not only making the payment process more convenient, but by providing real-time information to the customer about their daily cost which is changing how they think about and manage their electricity," said DEFG Executive Vice President Darren Brady.

The study evaluated the usage data from 1,394 customers enrolled in prepaid electricity metering programs in the Pacific Northwest. Then DEFG conducted a survey in the fall of 2013 of those customers, getting 112 responses.

"Overall, the results from this study indicate that prepay brings greater awareness of energy usage to the customer, encouraging them to take both basic actions—such as turning off the lights and turning down the thermostat—to making investments in energy efficient lighting, insulation, and HVAC systems," Brady said. "Customers indicated they switched to prepay to have greater control over their energy usage and bill, as well as enabling better budgeting of energy costs and allocation of available funds to pay for electricity."

Pike Research supports conclusions

Previously, clean technology market consultancy Pike Research issued a report in March 2012 that the adoption of smart meter technology will accelerate the growth of the market for prepaid electricity metering in the United States and globally.

"Hardware, software and service vendors are seeing increasing opportunities, as utilities worldwide are preparing to launch new prepaid programs or expand their existing prepaid services to a larger customer base," the consultancy said in its report, Hardware, Software, and Services for Prepaid Metering: Opportunities, Challenges, the Competitive Landscape, and Global Market Forecasts.

Pike Research estimated that the installed base of prepaid electricity meters was over 20 million worldwide in 2011, and it expected that number to surpass 33 million by 2017. With the new metering and wireless communication technology available, U.S. utilities are increasingly interested in offering prepaid electric services, the consultancy said.

Editorial Note:

Whether you want to upgrade your POS offerings, find a payment gateway partner, bone up on fintech regs or PCI requirements, find an upcoming trade show, read about faster payments, or discover the latest innovations in merchant acquiring, The Green Sheet is the resource for you. Since 1983, we've helped empower and connect payments professionals, starting with the merchant level salespeople who bring tailored payment acceptance and digital commerce tools, along with a host of other business services to merchants across the globe. The Green Sheet Inc. is also a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals.

Notice to readers: These are archived articles. Contact information, links and other details may be out of date. We regret any inconvenience.