The Pre-Pay Electricity - a Sign of the Times

The Queen of England

I got a leaflet through the door today from Prepower.ie - a company that is supplying "pre-pay electricity meters". Basically, they install - for free - a meter for which you buy credit, then enter your pre-paid code to top up your electrical supply service.

They claim that it's a way of "staying out of debt" & "saying goodbye to electricity bills forever".

It looked dodgy to me, so I did a bit of research & compared their charges to the rates I pay myself with Airtricity. At present, I pay 15.91 c per kWh. They charge 16.999 per kWh for the same supply. The Public Service levy is the same, however when you add the more expensive standing charge, the additional "Prepayment Service Charge" they add on, I worked out that if I were to switch to them from Airtricity, it would cost me an extra €250 per year based on my current average electricity usage.

It's not significant money to me, but I'd rather have it in my pocket than theirs.

What is worrying though, is that they are selling this - by implication more than by directly saying it - as a way to save money. As they charge more than their competitors for exactly the same product, I can't see how something like this would be a money saver.

The usage of electricity is unavoidable, so the only real way the only real way to reduce your costs are to use less of it. This isn't really a way of "saying goodbye to electricity bills forever" - it's just a different way of paying them at a more expensive rate and if you are having trouble paying your bills, adding to the cost of them by paying unnecessary additional charges to this company certainly isn't a way of "staying out of debt".

This to me seems no more than a way of trying to siphon money off people who can ill afford it.

Richard Hillman

It has been around for years in fairness. Possibly even pre the turn of the century.

Sparks43

Shocking :eek:

The Queen of England

Richard Hillman wrote: »

It has been around for years in fairness. Possibly even pre the turn of the century.

It reminds me of those meter boxes landlords used to install in bedsits where you'd have to feed them with coins to keep the electricity going.

It's just a more high-tech version of the same poverty-trap shite that went on years ago when we wus all poor.

Cupcake_Crisis

The Queen of England wrote: »

I got a leaflet through the door today from Prepower.ie - a company that is supplying "pre-pay electricity meters". Basically, they install - for free - a meter for which you buy credit, then enter your pre-paid code to top up your electrical supply service.

They claim that it's a way of "staying out of debt" & "saying goodbye to electricity bills forever".

It looked dodgy to me, so I did a bit of research & compared their charges to the rates I pay myself with Airtricity. At present, I pay 15.91 c per kWh. They charge 16.999 per kWh for the same supply. The Public Service levy is the same, however when you add the more expensive standing charge, the additional "Prepayment Service Charge" they add on, I worked out that if I were to switch to them from Airtricity, it would cost me an extra €250 per year based on my current average electricity usage.

It's not significant money to me, but I'd rather have it in my pocket than theirs.

What is worrying though, is that they are selling this - by implication more than by directly saying it - as a way to save money. As they charge more than their competitors for exactly the same product, I can't see how something like this would be a money saver.

The usage of electricity is unavoidable, so the only real way the only real way to reduce your costs are to use less of it. This isn't really a way of "saying goodbye to electricity bills forever" - it's just a different way of paying them at a more expensive rate and if you are having trouble paying your bills, adding to the cost of them by paying unnecessary additional charges to this company certainly isn't a way of "staying out of debt".

This to me seems no more than a way of trying to siphon money off people who can ill afford it.

That's actually surprising. My mam was talking about getting this in the other day as the bills are quite high, she can ill afford for them to be bloody higher!

squod

The Queen of England wrote: »

This to me seems no more than a way of trying to siphon money off people who can ill afford it.

Companies doing this since the nineties in Dublin. Pre-pay codes and cards and such. I'm shure Irish wáh-ter will be at it too.

Gatling

Nobody remember coin meters now I feel old ,
A lot of social housing have been using prepay electric and gas for as above forever ,
There is an advantage you pay what you use and you can monitor usage ,where bill pay you wait for the bill to arrive then you get 4weeks to clear said bill before the next household bill arrives that could be TV broadband and phone who expect to be paid within 4 weeks ,if your unemployed or get laid off which is easier,
The same for families on low income ,
Till your faced with the choice which gets paid or what get's sacrificed to keep the lights on or the heating I wouldn't knock it

Chuck Stone

Watt?

fussyonion

I have a pay-as-you-go meter which I had installed by ESB as I was having trouble paying my bill and I've never looked back.

I like the fact that I'm in control of how much I top up by, when I top it up and I can see how much I have left.

I dreaded getting a bill every two months and I found it hard paying it.
I've worked out that actually it's cheaper having the meter.

I buy €10 a week which lasts AGES and there's always the emergency €5 credit there if you need it.

ESB take their cut and put it towards the bill I owe them and that's fine by me.

I also find myself switching off things more and really, I think it's a good option for people who want to take control of their spending and not having to worry about mammoth bills coming in.

Sully

Doesn't the ESB offer this without a change to the plan your on, no? They did when I was growing up anyway, put in a pound coin for electricity! Fairly sure some holiday homes use it also!

Cupcake_Crisis

But what if the meter runs out in the middle of the night and your internet goes.......THEN WHAT?!?!?!?!

The Backwards Man

Does anyone still have the 50p meters? When I was young I put all my piggybank money into a neighbour's for the laugh. Bastard still hasn't paid it back.:mad:

FoxT

Cupcake_Crisis wrote: »

But what if the meter runs out in the middle of the night and your internet goes.......THEN WHAT?!?!?!?!

3G stick in laptop?

squod

Sully wrote: »

Doesn't the ESB offer this without a change to the plan your on, no? They did when I was growing up anyway, put in a pound coin for electricity! Fairly sure some holiday homes use it also!

The option is there to use pre-pay cards for most (credible) suppliers. You can also pay the old fashioned way and deposit money into an account with your name/acc number on it. You loose your on-line payment discounts though.

Chucken

The Queen of England wrote: »

I got a leaflet through the door today from Prepower.ie - a company that is supplying "pre-pay electricity meters". Basically, they install - for free - a meter for which you buy credit, then enter your pre-paid code to top up your electrical supply service.

They claim that it's a way of "staying out of debt" & "saying goodbye to electricity bills forever".

It looked dodgy to me, so I did a bit of research & compared their charges to the rates I pay myself with Airtricity. At present, I pay 15.91 c per kWh. They charge 16.999 per kWh for the same supply. The Public Service levy is the same, however when you add the more expensive standing charge, the additional "Prepayment Service Charge" they add on, I worked out that if I were to switch to them from Airtricity, it would cost me an extra €250 per year based on my current average electricity usage.

It's not significant money to me, but I'd rather have it in my pocket than theirs.

What is worrying though, is that they are selling this - by implication more than by directly saying it - as a way to save money. As they charge more than their competitors for exactly the same product, I can't see how something like this would be a money saver.

The usage of electricity is unavoidable, so the only real way the only real way to reduce your costs are to use less of it. This isn't really a way of "saying goodbye to electricity bills forever" - it's just a different way of paying them at a more expensive rate and if you are having trouble paying your bills, adding to the cost of them by paying unnecessary additional charges to this company certainly isn't a way of "staying out of debt".

This to me seems no more than a way of trying to siphon money off people who can ill afford it.

Ive had Electricity Bills in my name for about 35 years. I changed to prepay power because it does work!

My bill has gone down 10euro a week.

It does keep you out of debt. Airtricity etc are asking for 300e to go away from direct debits, this meter is free.

Cupcake_Crisis

FoxT wrote: »

3G stick in laptop?

Wizardry!!

FoxT

Good post, OP. It is a trend in a number of service areas , though.
The following are other examples of things that are more expensive in the longer term:
- Cellphone PAYG
- Fixed rate mortgages
- buying phones on contract
- gift vouchers/groupon-type vouchers, etc
- buying cars with down payment, fixed monthly cost, then balloon payment


All offer convenience in some way. Often the convenience comes from, say, having fixed outgoings every month. This may help people budget,but there is a price to pay for it, and the true price is rarely obvious, and can be quite unpredictable.

princemuzzy

Cupcake_Crisis wrote: »

But what if the meter runs out in the middle of the night and your internet goes.......THEN WHAT?!?!?!?!

aparently they dont cut you off between 6pm and 8am but the cost you run up gets taken from your next top up

some people havent a choice so people taken the piss out of it need to cop on

that been said i looked at it a while ago and found it is more expensive so once i got on top of my bill i now religiously pay 15 quid a week off my bill and i am now in credit with esb to the tune of 100 snots

FoxT

Chucken wrote: »

Ive had Electricity Bills in my name for about 35 years. I changed to prepay power because it does work!

My bill has gone down 10euro a week.

It does keep you out of debt. Airtricity etc are asking for 300e to go away from direct debits, this meter is free.

The meter cannot be free. The company that installs the meter has to buy the meter & pay a man in a van to go install it. There is a cost there, and you, the consumer, pay it. The cost is often hidden, though, and it can be impossible for the consumer to quantify it.

Chucken

FoxT wrote: »

The meter cannot be free. The company that installs the meter has to buy the meter & pay a man in a van to go install it. There is a cost there, and you, the consumer, pay it. The cost is often hidden, though, and it can be impossible for the consumer to quantify it.

I am the consumer! My dd was 45 a week, now I pay 35e.

I win.

I'll add here, if you get worried about your electric bill and ask your provider to help with a meter, they will tell you you that you need to be 2-4 bills in the red before they will consider it

kneemos

Chucken wrote: »

I am the consumer! My dd was 45 a week, now I pay 35e.

I win.

I'll add here, if you get worried about your electric bill and ask your provider to help with a meter, they will tell you you that you need to be 2-4 bills in the red before they will consider it

€45 a week?have you got a pot farm in the attic?

mikemac1

Used to rent a bedsit in Drumcondra, one of those grand old houses divided up into flats.

Landlady was robbing us all blind! :mad: 2 euro coins only on the meter and you'd be pumping in the money on a Sunday night trying to wash & dry your clothes for work the next day.

Saved up my 300 euro deposit, called ESB Networks and have paid direct debit ever since.
Didn't ask permission but no way was I talking no from the landlady. Better to seek forgiveness then seek permission



I think ESB offer you the pre-pay meter if you're struggling. Themselves and the other suppliers are cracking down on debt hopping - oweing money to maybe ESB then skipping to Airtricty and then skip elsewhere too.

Run up arrears and you get flagged

You will be flagged if you are more than 42 days and €250 behind

Are the days of debt hopping over?

StillWaters

Sully wrote: »

Doesn't the ESB offer this without a change to the plan your on, no? They did when I was growing up anyway, put in a pound coin for electricity! Fairly sure some holiday homes use it also!

ESB will only install if you are in arrears. The electricity and charges are the same with them if you have the prepay as if you pay in the usual way.
It's the other crowds such as prepay that charge more per unit and high service charges.

Anyone struggling with their bill, would be better off going into arrears and getting the ESB meter.

Cushie Butterfield

The Queen of England wrote: »

It looked dodgy to me, so I did a bit of research & compared their charges to the rates I pay myself with Airtricity. At present, I pay 15.91 c per kWh. They charge 16.999 per kWh for the same supply. The Public Service levy is the same, however when you add the more expensive standing charge, the additional "Prepayment Service Charge" they add on, I worked out that if I were to switch to them from Airtricity, it would cost me an extra €250 per year based on my current average electricity usage.

It's obviously not the way to go for you, but they don't claim to be cheaper than Airtricity - as far as I can see their price comparison is with Electric Ireland. Their prices, PSO levy & standing charges are the same as Electric Ireland. The only difference is their 37.5 cent per day prepayment service charge (€137 per year).

Of course it's not for everyone, but there is no connection, disconnection or re-connection charges like with Electric Ireland & Airtricity. If you run out of credit & are cut off you just top-up & you're on again. Electric Ireland & AirTricity won't give just anyone a meter either - you have to satisfy certain conditions.

I would say that switching to them would suit some people, even if it is €137 per year more than Electric Ireland, who, going by your calculations are ripping people off also compared to Airtricity!

jjbrien

There is another option people can use instead of these prepay meters. I am on Level Pay with board gais I pay 84 euro a month so 21 euro a week. They spead my bill out over the year makes it real easy to pay. I always know what that it will be 84 euro so makes it dead easy to budget. I get the online and direct debit discounts too so its happy days for me.

For those on welfare if they go on level pay and then use the house hold budget service from an post. An post will take whatever amount the customer wishes out of their welfare towards the bill and you never have to pay the direct debit.

Grayson

I briefly moved into an apartment lasy year that had a prepay meter. It was annoying as hell. I had no idea how much to top up by at the beginning of the month. The meter was outside so I'd have to go out in the cold to pop it up and I couldn't check online.

MurdyWurdy

kneemos wrote: »

€45 a week?have you got a pot farm in the attic?

Was just thinking this. My last bill was €90 for 2 months!

Capt'n Midnight

poverty trap stuff indeed

most of this sort of thing happens first in the UK and gets advertised heavily here when the UK regulate it


The meter and installation costs money. The company can only make money if they charge the customer enough extra to pay for all that. And these are targeted at people who already use less electricity than average.

That alone should scare people away



if you can buy credit in a shop the shop will be getting a 5-10% cut too.




Also be aware of one very important aspect of pre-pay

you have no electricity / water the instant the money runs out, there are no reminders or warnings before you get cut off. You can't negotiate with a meter

goose2005

The Queen of England wrote: »

It's just a more high-tech version of the same poverty-trap shite that went on years ago when we wus all poor.

How is it a poverty-trap to stop people going into debt?

The Barefoot Pizza Thief

Seen a guy in Smithfield asking people to top up his card or he would be without electricity for the week. There is a minimum of a tenner, so doubt he was successful. Didn't have one myself at the time, but do now. Hate using the emergency €5 as it makes some high pitched racket initially when you hit zero and a euro or so before also.

Tiddlypeeps

I can see the appeal in the prepay thing, even if it is more expensive. When you have more going out than you have coming in it can be very easy to pay for the things that need to be paid today when another bill is off in the distance and out of mind. Both have to be paid but one seems like a higher priority because it's needed now even tho electricity is probably a much higher priority. When the bill comes around then you don't have enough to cover it. I would have much preferred this option in my student days.

FoxT wrote: »

Good post, OP. It is a trend in a number of service areas , though.
The following are other examples of things that are more expensive in the longer term:
- Cellphone PAYG
- Fixed rate mortgages
- buying phones on contract
- gift vouchers/groupon-type vouchers, etc
- buying cars with down payment, fixed monthly cost, then balloon payment

How are even half of these things more expensive in the longer term?

If you have to top up multiple times a month then sure PAYG is probably more expensive, but only if you are stupid about it. Some people would barely go through €10 credit a month or less, it's clearly a cheaper option for those because bill pay is a minimum of €20.

Fixed rate mortgages can be cheaper, but it's a gamble that essentially comes down to a roll of the dice. It's also the opposite of the prepay thing because with a fixed rate the rate is always higher than the current standard. You are essentially betting the bank that interests rates are going to go higher than the rate they offer.

Buying phones on contract makes sense if the minutes suite you and the cost of the bill is what you would have been paying anyway. At that point it's essentially a free phone.

I have no idea how groupon types vouchers cost more in the long term. They offer something that would normally cost more for less. I recently bought a voucher for dinner in a place I was going to go to anyway, would have cost about 70 for what I paid 30 for. How will I end up paying more for that in the long run?

kylith

I initially thought it looked like a good idea, but realised that if it was any cheaper than the other suppliers they'd say it in the ad, so I'm really not surprised to hear they're that expensive.

Kind of like the Sky ads; they keep going on about how great their broadband is, but you have to do a lot of digging to find out that the speeds are exactly the same as Eircom.

Latchy

The Queen of England wrote: »

It reminds me of those meter boxes landlords used to install in bedsits where you'd have to feed them with coins to keep the electricity going.

It's just a more high-tech version of the same poverty-trap shite that went on years ago when we wus all poor.

I knew a chap who discovered a novel way of slowing down or stopping the red dial on those ' high tariff ' meter boxes from rotating.

super_furry

Watt? This is a shocking turn of events. Next thing people will be pawing their joules to pay their electricity bills.

Ando's Saggy Bottom

super_furry wrote: »

Watt? This is a shocking turn of events. Next thing people will be pawing their joules to pay their electricity bills.

Ohm-y God. lol.

Cantona's Collars

Electric Ireland will fit these in peoples homes also,lots of houses in the Council estates around my town have them.Get a top up card & viola electricity.

recyclops

Just call up any supply company and ask for it, they are all chasing debt and will happily install them for free

Latchy

Some UK electricity supply company's can insert a meter in your home with a £10 emergency top up credit , no annual standard charge on the meter and you then have your pre pay card swiped at your local post off which instantly sends electricity to your meter .

..Brian..

Prepay meters are ok in theory if you're in debt with your suppliers or having difficulty keeping up with the bills etc but the fact of the matter is they are the most expensive way to buy electricity. It's always cheaper to have a credit meter (get a bill).

A good option becoming more available these days is an equal payment plan or fixed payment plan where a monthly amount is calculated based on annual comsumption and then devided by 12. It means you will have a direct debit for the same amount every month and it makes it a lot eaiser to budget. Beware of Bord Gais though as they used to add 20% to your consumption just in case. Airtricity add 5%. Not sure about Electric Ireland.

homerjay2005

the savings here is when you have no choice but to conserve electricity.

Bills are reactive measures, but pre pay is proactive and youve no choice...you either pay and cut down on costs, or you have no electricity!

in the long run, it will save money as people are more conscious of what they use when they can see the costs real time.

jester77

Wow, didn't realise how cheap electricity is in Ireland, yet I always hear people complaining that it is expensive. Cheapest here in Germany is around 26c per kWh.

Tiddlypeeps

Another good point for it is if you are the type of person to miss a bill then you get hit with missed payment charges. From the bank for missing a direct debit and possibly on the suppliers end too depending on who you are with.

If this happens to you often and you don't mind going a day or so without electricity then it could be cheaper to go with prepay.

seamus

The Queen of England wrote: »

I worked out that if I were to switch to them from Airtricity, it would cost me an extra €250 per year based on my current average electricity usage.

That's looking the wrong way at it, because...

homerjay2005 wrote: »

the savings here is when you have no choice but to conserve electricity.

Bills are reactive measures, but pre pay is proactive and youve no choice...you either pay and cut down on costs, or you have no electricity!

in the long run, it will save money as people are more conscious of what they use when they can see the costs real time.

Postpay/billing is basically a tab that you run up your debts on. When people have money difficulties, their first instinct is to kick the problem down the road, to a time when hopefully they will be able to service the debt. The consumer is effectively being given infinite (or indefinite) resources, which makes it very difficult to budget. Postpay accounts make money problems worse because they don't cap your usage. Electricity is the worst for this because the consumer doesn't even have to pay their bill fully in order to keep their service.

If that ability is taken away from someone and they're forced to budget their resources because they're finite, they will use them much more sparingly. So while on a direct, per-unit basis the electricity is more expensive, the effect of prepaying it causes the homeowner to reduce their overall usage and therefore save money.

It's win/win for the company because they make a higher margin on electricity and they don't have any kind of major arrears problem.

From what I understand, the old coin-operated electricity popular in cheap bedsits in the past was more to do with landlords being unwilling to let potentially deadbeat tenants take out electricity accounts and leave the landlord with a big bill to pay.

For the new water charges coming in, a prepay meter is actually the kind of thing that I would love to have because it would very quickly make me take stock of the water I'm using.
Prepay electricity is hassle because I don't ever really want the electricity to just cut out.

Pumpkinseeds

I hate that advert for the prepay meter. It disgusts me and the message that it sends is awful. You have a woman and child in a house and if they don't put credit on the meter they have no electricity until they can feed the meter. At least with a bill anyone who has difficulty paying the bill has a bit of time to pay it as opposed to being left with no power for however long.

As usual the utility companies are crucifying the poorest of the poor

Tiddlypeeps

Pumpkinseeds wrote: »

As usual the utility companies are crucifying the poorest of the poor

Nobody is being crucified, using it is a choice.

Latchy

seamus wrote: »

Prepay electricity is hassle because I don't ever really want the electricity to just cut out.

Not forgetting that if your electricity does cut out your also charged extra for any emergency credit you may be using or have used to keep it ticking over , as well as any annual standard charge for meter to .

Pumpkinseeds

Tiddlypeeps wrote: »

Nobody is being crucified, using it is a choice.

People need electricity to power their homes, it is a basic neccessity not a luxury. People shouldn't be expected to go without light, heat or electricity to refrigerate their food. To force people to pay more for their electricity or do without it is a Dickensian approach to fuel poverty, you don't work for one of the main electricity suppliers by any chance do you?

looking_around

Capt'n Midnight wrote: »

Also be aware of one very important aspect of pre-pay

you have no electricity / water the instant the money runs out, there are no reminders or warnings before you get cut off. You can't negotiate with a meter

The local tech shop I'm working in sells this prepay electricity, or pin pay as they're calling it.

They won't cut you off on weekends, or between 6pm and 8am, so if/when you do get cut off, you do have a chance to go to your local shop and top up. Although they'll charge you for the time used.

I actually don't like this pin pay stuff.
I tell family and friends, if they want to avoid bills stick 20euro a week into their electricity account. Increase to 30 etc, if needed. No unexpected bills this way. And cheaper than this pinpay. There's also the spread out/yearly calculation to charge you the same each month, the next year that could either go up or down. Thats ok too. I prefer to just pay into my bordgais account weekly.

Although they are not crazy expensive. I certainly hate trying to encourage pinpay elec onto people while at work.

There are better/cheaper options.

Tiddlypeeps

Pumpkinseeds wrote: »

People need electricity to power their homes, it is a basic neccessity not a luxury. People shouldn't be expected to go without light, heat or electricity to refrigerate their food. To force people to pay more for their electricity or do without it is a Dickensian approach to fuel poverty, you don't work for one of the main electricity suppliers by any chance do you?

What? I'm saying the choice they have is to get their electricity the normal way or use they can use prepay meters. Nobody is forcing them to pay more or do without. It's a free market they can choose the cheapest provider or they can choose a more expensive provide because they offer the service in a different way that is preferable to them.

And no I don't work for any electricity suppliers.

seamus

Pumpkinseeds wrote: »

People need electricity to power their homes, it is a basic neccessity not a luxury. People shouldn't be expected to go without light, heat or electricity to refrigerate their food. To force people to pay more for their electricity or do without it is a Dickensian approach to fuel poverty, you don't work for one of the main electricity suppliers by any chance do you?

His point is that nobody is being forced to do anything. They can choose a prepay or postpay supplier, it's up to them.

Actually, the marketing in the ad is more than cynical. The implied portrayal is that of a single mother trying to provide for her child and struggling with electricity costs so her child can't have fun when they get cut off.
Moving to prepay means that you can now have a cup of tea while you snuggle your child on the couch and therefore your child loves you even more.

They know their target demographic and are pretty shameless about it.

Femme_Fatale

Think there's a certain amount of emergency credit, so if your top-up hits zero you won't get cut off immediately and the amount you went "over" by, will come off your next top-up.

Pre-pay is kinda a false economy because of the higher charges, but because it makes the customer more conscious about usage, it probably works out the same. As said though, I think you have to be in arrears to have one installed by some places. Bizarre seeing people saying wait until you are in arrears and then ask to have one installed - why not just make pre-payments that whole time?
With a bill, customers can still make pre-payments - there's no need to wait until the bill arrives. I put in a tenner a week, resulting in most of the bill being paid by the time I get it, and I still have another two weeks to pay it in full. There are also ways of watching your consumption without a pre-pay meter, e.g. an energy monitor.