ATLANTA -- Prepaid calling cards have been a hit in the telephone industry, but it may be a long time before most United States residents can purchase energy before actually using it. While prepaid metering is popular in Europe and with budget-conscious customers in the United States, technology costs and regulatory red tape continue to prevent many U.S. utilities from implementing prepay programs, according to The Chartwell Prepaid Metering Report 2003, a newly released update of Chartwell’s previous prepaid metering report.
Similar to residential time-of-use rates, prepaid metering is something many utility officials think about, but few utilities are actually offering. Only about 2% of utilities have prepaid programs, though about 25% of utilities are considering them, according to Chartwell’s 2002 survey of 115 utilities. This lack of penetration apparently led Motorola, the leading prepay vendor in the U.S., to exit the prepaid metering business at the end of 2002.
The news is not all bad for prepay advocates, however. Prepaid programs are extremely popular with credit-challenged customers. Salt River Project’s prepay program – the largest in the country with 28,000-plus participants – continues to grow rapidly. While the cost of prepaid metering systems can be close to three times that of standard AMR installations, Salt River Project officials say the utility’s prepaid metering program more than pays for itself when avoided costs related to delinquent customers are considered, according to a case study in The Chartwell Prepaid Metering Report 2003.
The Chartwell Report on Prepaid Metering 2003, which is available for $250, includes two case studies and analysis of the current market and Motorola’s decision to exit the prepay field. The report is part of the AMR Research Series, a twice-monthly publication covering the automated metering reading industry. Membership in The Chartwell Metering Research Series is available for $2,995.
About Chartwell Inc.
Chartwell Inc. seeks to provide a better understanding of technologies, issues and management practices in the utility and retail energy services industry. Chartwell provides executives and managers in the utility and retail energy business up-to-date, unbiased information on the issues facing them as they strive to meet the demands of a rapidly changing industry. Chartwell prides itself on: Independence, Integrity and Insight.
Chartwell Inc. Press Contact:
Garrett Johnston
Managing Editor/Research Analyst
email: gjohnston@chartwellinc.com
