Although many Americans are longtime subscribers of prepaid wireless services, prepaid electricity is relatively new — at least in the U.S. In other countries, most notably South Africa, United Kingdom and Ireland, a large percentage of the population uses prepaid electric service.
More than 75% of South African residents use prepaid electricity and between 15 % of residents in the United Kingdom subscribe to prepaid electricity. The prepaid model is so successful in the United Kingdom that the government has mandated a roll out of smart meters nationwide which will be prepaid compatible.
In contrast, less than 10% of utility companies in the United States offer prepaid electricity. The majority of the service is offered by small utility companies that serve low income communities. The states that lead the way in prepaid electricity are Arizona, Texas, Oklahoma, State of Washington and Vermont. Arizona has the oldest prepaid program which was initiated in 1993.
Surveys have been conducted which reflect that prepaid customers are very satisfied with the service and would recommend the service to others. In addition, customers aren’t the only benefactors of the program, as utility companies also benefit as a result of better revenue protection and cash flow. While there may be disadvantages to using the service, the benefits far outweigh any negatives. More people are now realizing the benefits of the service and the use of smart meters is added incentive for more utility companies to adopt this model.