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Thursday, March 6, 2014

Prepaid energy part of 'mega-trend'

Ecoalign LLC, a marketer focused on the intersection of ecology and commerce, reported that prepaid energy in the United States is poised for growth as younger consumers amenable to the prepaid option enter the financial mainstream. In an online survey of 1,001 consumers, 39 percent were interested in prepaid electricity, with younger adults, renters and males most open to the service.

In the fourth annual Prepay Energy at an Inflection Point, the top reason for interest in prepaid electricy remained the ability for consumers to better manage electricity costs. Ecoalign cited DEFG research that said prepaid energy services can reduce energy usage by an average of 11 percent. Consumers seem to inherently understand this benefit, since electricity usage is more closely tied to balances available on prepaid accounts and that relationship can be more closely monitored via smartphones.

Ecoalign said prepaid energy is part of a greater trend toward prepaid solutions and smart grids. "Understand that prepay energy did not arise from a utility smart grid project; it's part of a mega-trend toward convenience and control over family budgets," Ecoalign said.

The researchers noted that, as prepaid electricity services "ripen," ultity providers can expect over a fifth of their user bases to switch to prepaid electricity plans in the next two to three years. Among Ecoalign's findings:

  • Respondents aged between 18 and 54 are significantly more interested in prepaid energy than those 55 and older, 30 percent versus 8 percent respectively.
  • Renters are more interested than homeowners in prepaid energy, 28 percent versus 22 percent.
  • Forty-three percent of respondents said being able to make payments online is the most important feature of a prepaid electricity program.
end of article

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