Prepaid metering is a system whereby consumers purchase electricity by a smart card. The amount paid together along with other information is encoded in the smart card. In sequence to transfer the credit, the consumer inserts the card within the meter. The meter reads the data and whiles the paid for energy has been exhausted, the consumer gets the card reloaded/ reprogrammed. The system has the ability of programming along with time of use tariffs, multiple rates and etc.
The use of prepaid meters results in almost total elimination of non- payment and delayed payment and enables transfer of reliable, correct and up to date consumption and billing data according to tariff policy in use. This information can be utilized by the utility for demand forecasting and for controlling peak demands. It also means substantial reduction in staff for meter reading, bill complaints, bill serving, and bad debts, etc. Full meter programmability allows maximum flexibility in changing tariffs. Consumer can also decide in advance the affordable level of expenditure, which helps him and the utility in elimination of disputes regarding inaccurate bills.