Three Common Misconceptions About Prepaid Electricity in South Africa

What’s the deal with prepaid electricity in South Africa? How does it work? What’s fact, what’s fiction? Home+ takes a look at the top three most common misconceptions about how prepaid electricity meters work in South Africa.

Misconception #1: That prices for prepaid electricity are cheaper than postpaid electricity

While prepaid electricity rates are not always cheaper than post-paid electricity rates (the price of electricity units can vary depending on your municipality, and how much electricity you’ve already consumed for the month) there are a number of other financial benefits that come with prepaid electricity.

• It eliminates municipal service charges: you will no longer be required to pay a service charge for meter reading or network charges, and other billing-related expenditures.
• It eliminates the possibility of a shock bill: municipalities don’t read post-paid meters as regularly as they should. Instead, they ‘estimate’ how much you’ve used, and reconcile every three months or so. This means that if you’ve used more than estimated, it is added to your monthly electricity bill, which can be a nasty surprise for the unprepared.
• You have better control over your electricity consumption: your prepaid meter shows you exactly how much prepaid electricity credit you have, and it’s much easier to monitor and adjust your consumption accordingly. Using less electricity means spending less money, which is better for your budget.

Is it better to have prepaid electricity in South Africa?

From a user perspective, it’s better to have control over your monthly spend than to build up debt with your municipality. This could affect your service delivery, and with interest and penalty fees, can get very expensive. With prepaid electricity, you become more cost-conscious. You will no longer leave lights burning unnecessarily, you will be more likely to power down appliances when not in use – all of which is also better for the environment, ultimately.

From a municipal/utility provider perspective, prepaid electricity is a great way to cut down on the costs associated with service delivery. Switching to prepaid meters leads to better payment recovery, lower debt collection costs, and prevents late payments.  The municipality also cuts the costs of meter reading, bill preparation, and debt enforcement involved with disconnecting non-paying customers. Reduced costs for utilities like Eskom and City Power means that service delivery can only get better.

In short, prepaid electricity in South Africa is a win-win for all involved.

Misconception #2: That municipality prepaid electricity meters are easy to bypass and that you can’t get caught

This is definitely a huge misconception. Bypassing or tampering with a prepaid meter (whether water or electricity) is a crime.

In addition to the possibility of criminal prosecution and facing jail time, users who are caught tampering or bypassing their meters will be fined, and need to back-pay the estimated electricity use for the duration of the illegal connection, meter bypassing or tampering.

How is a prepaid electricity meter bypass detected?

Smart meters can help power utilities such as Eskom find tampering instances remotely.

1. Unusual Readings: Smart meters are now able to measure and report real-time information that was previously unavailable to the municipality. These include detecting and reporting meter anomalies such as reverse current flow and flagging meters that aren’t registering energy consumption.
2. Physical evidence of tampering: Typical signs are if the seal has been removed from the meter, the bottom cover is loose or if any additional wiring connections can be seen.
3. Data analysis: The data measured and transmitted by the meter itself is very useful for spotting tampering. With 15-minute interval readings standard, a utility is able to analyse an account’s billing over time. In this way, discrepancies can be flagged and investigated.

Misconception #3: That purchasing and loading prepaid vouchers/credit onto a prepaid meter is a hassle

This is definitely false. It might have been a hassle to purchase prepaid electricity vouchers a few years ago, but in today’s digital-first world, it couldn’t be easier. Most banking apps offer the ability to purchase prepaid data, electricity and water tokens online. Be wary of using these, however, and make sure you do your homework into exactly how banks make money off these transactions. If you don’t, you could land up spending more money and getting fewer electricity units for your buck.

Did you know? You can purchase prepaid electricity online directly in the Home+ app.

You can use your credit card or debit card to pay, or you could even pay via EFT. There are no hidden fees when you purchase electricity on the Home+ app, and every purchase earns rewards!

Top tip: You can save your meter number and payment details (securely) on the app to make it easy to recharge your electricity meter in the future. So easy, you can top up your electricity credit in under a minute!

Conclusion: prepaid electricity meters are the way to go in South Africa

If you’re still on the fence about whether to switch to prepaid, take a look at the benefits of prepaid electricity for South African communities. Read the smart guide to prepaid electricity and get clued up on the dos and don’ts of prepaid electricity. If you’re interested in spending less money on electricity (i.e: saving instead of spending!) we’ve put together some tips that actually work to help lower your household consumption.