Utility Customers Will Be Able to Pre-pay for Services 

Come this winter, cell phones won't be the only thing locals can purchase pre-paid plans for.

In December, Memphis Light, Gas, and Water (MLGW) is rolling out a pre-payment plan for customers who have smart meters, which provide more detailed information on energy consumption than conventional meters.

MLGW customers can decide how much they'd prefer to spend on their utilities and receive a notification when those funds are about to exhaust.

"You can put enough down that might last you three months or you can put a smaller amount down that might last a couple of weeks. That's completely up to the customers and how fast they use the utilities," said MLGW President Jerry Collins.

"And we would contact them by whatever means they wish, be it text message, telephone, [or] email, and let them know they're so many days away from that amount of money running out. Then they can choose to put more money on their account if they need to or make other arrangements."

By the end of summer, there will be 60,000 smart meters installed at 24,000 homes or buildings throughout the city.

Collins said the utility pre-pay program has been active in the U.S. for five years, and participants have reportedly saved around 12 percent on average. One of the companies utilizing pre-pay is Gibson Electric Membership Corporation (EMC), a nonprofit, member-owned and member-controlled electric cooperative that operates in eight Northwest Tennessee counties.

Gibson EMC has been implementing its pre-pay program, Pay-As-You-Go (PAY-Go), since 2009. Currently, more than 3,000 of its 35,000 member-owners use PAY-Go, according to Rita Alexander, vice-president of human resources and communications for Gibson EMC.

"It gives new members a way to establish service with minimal set-up costs," Alexander said. "It enables members to closely monitor their energy use on a daily basis through email, our automated phone system, or through in-home display units. The information that members receive about their electricity use helps them to become more energy efficient and save dollars."

Smart meters closely monitor a customer's utility consumption, informing them of their usage every 15 minutes. And the meters can be connected or disconnected without utility workers coming to a residence to do it manually.

Pre-pay plans eliminate disconnection fees associated with non-payment, and the plan rids the need for deposits from customers. People with conventional meters are only able to measure their utility usage once every 30 days. The meters have to be physically connected or disconnected.

MLGW has been developing its pre-pay program since 2013. Collins said he thinks it would be a significant benefit to both MLGW and its customers financially and in terms of convenience.

Collins said if only a small portion of MLGW customers opted for pre-pay, around $8 million could be saved annually, if participants were able to save 12 percent on their utility bills.

"It's an opportunity to save a substantial amount of money by saving energy," Collins said. "And the locations across the country where pre-pay has been implemented have seen savings in the 10 to 12 percent range. If we have a substantial amount of households that are able to save that much, then they can use the money they save toward things like rent, food, and medicine, and things that will improve their quality

of life."


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