EPRG 1108

Philipp-Bastian Brutscher

Payment Matters? – An Exploratory Study into Pre-Payment Electricity Metering

EPRG 1108 | Non-Technical Summary | PDF

Abstract: In this paper we look at the role of pre-payment (in the context of pre-payment metering) for household electricity consumption. Using a matching approach, we find that households paying their electricity up-front tend to consume more electricity than households paying ex post. This is despite receiving information feedback on their electricity use and facing higher transaction costs. In the second part of the paper, we explore to what extent this finding can be linked to an increase in payment flexibility under a pre-payment regime. Using data from the main electricity supplier in Northern Ireland (NIE Energy), we explore how people top-up their pre-payment meters and whether there is a link between people’s top-up behaviour and their electricity consumption.

Keywords: Pre-payment Metering, Top-Up Behaviour, Demand Management, Pain of Paying.

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