[]   Your account

A guide to pre-payment meters (pre-paid gas and electric)

A guide to pre-payment meters (pre-paid gas and electric)

Whether you use electricity, gas, or both – there are a few ways to pay for your energy. Around four million households in the UK are using pre-paid energy. Here’s what you need to know about pre-payment meters and what they might mean for your energy bill.  

Peter Earl
From the Energy team
4
minute read
posted 06 FEBRUARY 2020

What’s a prepayment meter and how does it work? 

With a prepayment meter, you pay in advance before you use energy. It’s a bit like having a pay-as-you-go mobile phone, instead of a contract phone. Using a prepayment meter is a different way to pay for energy compared to monthly direct debits. 
 
Prepayment meters have a slot or keyhole on the front, which takes a prepaid card or key. While the method of topping up can vary depending on your energy supplier and meter, all cards and keys require you to add credit before inserting them in the meter. Shops with a PayPoint or Payzone facility, and Post Offices, offer top-up service facilities, and some energy suppliers now offer top-ups via text, app or online. 

Who would use a prepaid meter? 

Prepayment meters are sometimes used by people who’ve had problems paying their energy bills in the past. That’s because it may help them keep track of what they’re spending.  
 
The prepaid meter can also be used to help repay outstanding debts to your energy supplier. For example, with £20 added to a card, you could pay £5 towards the old debt and £15 for new energy, once you put the card in the meter. 
 
Some landlords also choose to fit them in rental homes, to avoid unexpected and unwelcome bills with interest, when tenants leave a property. 

What is the prepayment price cap and how does it apply to prepayment meters? 

In 2017, Ofgem introduced a prepayment cap, also known as a ‘safeguard tariff’, which is updated on 1 April and 1 October each year. It limits the amount the supplier can charge you per kWH for electricity or gas. Suppliers can't charge you more than the cap amount, for each unit of power that you use. The cap’s purpose is to help prevent UK households from overspending on energy.  
 
The cap limit applies if you: 

  • Use a prepayment meter to pay for your gas or electricity in advance (including through a token-operated meter) 
  • Have the Government’s Warm Home Discount and are on a standard variable tariff, or a tariff you haven't chosen – sometimes known as a default or deemed tariff.  

The supplier must automatically make sure the cap prices apply – you don't have to apply for it. The cap scheme is expected to run until the end of 2020, with the price level being adjusted, up or down, every six months. 

Does having a prepaid meter make energy cheaper? 

Unfortunately, no. Prepaid meters are often put in place for those struggling to pay for their energy, and the tariff rates tend to be higher than with a standard meter.  

Can I still save money on a prepaid meter? 

You could still save money on a prepaid meter. Most energy providers will have at least one prepaid tariff on offer, so it may be possible to shop around for a good deal from your existing supplier. If they only have a single prepaid tariff, you can shop around to see if a better-priced tariff might be available, from a different supplier. 
 
Take a look at our energy saving tips, for more ways to save on your energy bills. 

Can I change my prepayment meter to a regular one? 

You can change your prepaid meter to a regular one. If you inherit a prepayment meter through a house move, contact your energy supplier to tell them you’re the new owner. You should then be able to change your meter if you want. They may run a credit check as part of the direct debit process. 
 
And if you’ve had problems with bills in the past but you’re back on your feet, you might be able to switch from a prepaid to a regular meter, too. This will probably be subject to a credit check and, often, on the condition that your account is 100% debt-free. 
 
Finally, check whether your energy supplier charges to change a meter. Some do and some don’t, so it might be worth shopping around if there’s a charge involved. 

How do I get a new card or key for my repayment meter? 

If you’ve lost your gas or electric meter key or card, or it’s been damaged or stopped working, contact your energy supplier to find out what to do. They’ll probably give you the option of picking up a new meter key or card from a Payzone or PayPoint outlet or a Post Office. You may be given a reference number to take with you.  
 
Alternatively, your supplier can post a new gas or electric key or card to you, but it can take three to five working days to arrive. You may be charged for getting a new key or card, especially if it’s not the first one you’ve lost. 
 
Don’t worry about going without energy, as you should be able to top up without a card using your top-up card premise number (a numbered code). Your supplier will give you this when you contact them. 
 
It may be possible to get any credit on a lost repayment meter key or card refunded - and to put the refunded amount on the new card. But you might have to provide proof of buying the credit. 

Compare energy suppliers

Get a quote in minutes and you could start saving

Get a quote
Compare energy suppliers in minutes and you could start saving Get a quote

comparethemarket.com uses cookies to offer you the best experience online. By continuing to use our website, you agree to the use of cookies. If you would like to know more about cookies and how to manage them please view our privacy & cookie policy.