How can the prepaid electricity be possible?

Answer 1

You need two things in place to supply prepaid electricity:

1. A specific type of meter with a mechanism that can count down electricity units, and can be topped up. This topping up can be done by a coin, token, key, card or a special code uniquely made for that meter. Many modern AMI (Automated Metering Infrastructure) meters enable prepaid electricity have an integral or optional disconnect allowing control from the utility company systems. This eliminates the need for tokens, smart cards or keypads, you simply pay the utility and they don't disconnect the meter until what you have paid for runs out.

2. You need to have a place to take the money and sell the credits for the meter; this can be a shop, a machine or a mobile phone. Modern systems are web enabled, allowing you to purchase power over the web or phone, in remote locations or developing countries low-tech solutions include scratch cards and paper. Utility vending kiosks and resellers fill in the gaps.

If you are familiar with prepaid mobile phones and long distance phone cards - the system is the similiar. The meter validates it's code and power starts.

When the credit runs out the power stops going in to the home: the meter still gets power from the grid but it doesnt let past the meter so the user has no power. If there is a power cut ; the meter has a battery (usually good for a couple of years without being topped up).

In some cases, the meters may allow "emergency" levels of power. Enough to keep a couple lights on and your refrigerator running, but not enough for HVAC or a water heater.

The biggest difference is that you don't pay the utility a large deposit, and there is no penalty for disconnects. The consumer usually pays the exact same rate for power, although sometimes small fees may be added per transaction. Progressive utilities have found that prepaid customers use less electricity because they are empowered with timely feedback about their usage and manage it better.

Interested? Talk to your utility. they tend to do things the way they have always done it because they are usually in a "monopoly" position and don't focus on ways to improve service like the cell phone industry does.