By: Gavin O’Neill, Managing Director, Generis Technology Limited
As we have seen with recent protests and the growing media attention, rapid decarbonisation is high on the agenda. As a foundation for the smart, flexible, connected world the advent of the new generation of smart meters will also democratise this shift by placing even greater control into the hands of consumers through better monitoring on consumption, spending and introducing energy goals.
Prepayment empowers customers to have greater control, enabling them to fit their energy consumption in around their lifestyle whilst also reducing the chance of falling into debt and improving energy efficiency. But for consumers to reap the full benefits of prepayment, it is now down to both existing and new energy suppliers to step up to the challenge and start innovating with a range of prepayment options for consumers. Smart meters and their central, national communications hub will make it easy to switch to prepayment options – which can deliver real benefits to consumers derived from lower cost to serve and through closer monitoring of energy usage.
Historically, prepayment has always been seen as a tool to help address the issue of fuel poverty and bad debt. Now, it’s seen as a way to educate and inspire consumers to a new way of thinking, by exploring new types of prepayment schemes. But just as this requires getting consumers more ‘switched on’, the industry is equally reliant on the energy suppliers switching on to offering new tariffs that incentivise smart usage.
To get people more engaged with the idea of altering their behaviour, changing the way energy can be purchased is key. We pay for petrol at the point of purchase based on what we predict we will need/use. Prepaying for your energy will work in the same way, using an app connected to your smart meter.
Energy usage based on predicted use, captured via intelligent smart meters, will alert consumers when they are likely to run out, enabling them to purchase more energy by prompting them to ‘top-up’ easily and quickly via an app or some other means.
Smart meters offer an exciting opportunity to make it easier for consumers to switch suppliers and tariffs to get better deals, while having access to innovative prepayment options. These capabilities will empower households to get a full handle on their energy consumption and associated costs.
However, for consumers to fully realise the benefits the prepayment opportunity presents, the industry must switch on to the concept of incentivised prepayment tariffs. Only then will engaged consumers capitalise on flexible, cheaper tariffs as well as reducing issues of bad debt while the utilities industry will benefit from the shifting use of energy from peak time. Engaged customers will help the industry to deliver on the promises smart meters make as well as encourage consumers to switch on to smarter energy use while supporting the UK’s bid to counter the impact of climate change.