Pre-pay electricity meters

RobM99

Just a thought - why are they more expensive that regular meters? I'd have thought paying up-front would be better for the energy company.

Mstty

Not all providers are more expensive but the basic answers is Ofgem allow suppliers to charge more for prepayment. 

Each payment made comes with a charge from the bank/credit card so not surprising it's more than a single direct debit payment each month/quarter.

QrizB

They cost more to administer. The energy cos have to pay for the keys and for the use of the prepayment terminals in shops, etc.

*But* while the standing charges are higher, the unit rates can work out to be slightly lower than DD. See EDF's deemed rate card for examples.

Eg. in my region, for single-rate electricity - DD 43.39p/day plus 28.46p/kWh, PP 48.34p/day plus 28.22p/kWh.

It's cash/cheque that's the expensive option, 49.10p/day plus 29.97p/kWh.

pochase

The unit rates for gas and electricity are usually not much different, sometimes even slightly cheaper for prepaid.

What is higher are then standing charges, and that is explained with the higher administration cost.