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What Are Prepaid Smart Meters & Why Were They In Budget 2020?

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After we made our blog post last week about Budget 2020, we got a lot of emails and messages from people asking us what exactly the Government means by Prepaid Smart Energy Meter in India. Since we’ve been working on this project and developing Prepaid Smart Meters for a long time, we thought we would make a small blog just to explain the product.

As mentioned in Budget 2020 by Honorable Smt. Nirmala Sitharaman, the State Electricity Distribution Companies (called DISCOMS) is under financial stress. Thus, in her budget speech, she urged all the States and Union Territories to replace conventional energy meters with prepaid smart meters in the next 3 years.

So what are these smart meters?

Smart cities and smart grids are constantly being discussed by the industry and the government – it has become a part of everyday language. Smart Meters in India are one part of the entire smart city plan. What makes a meter smart? It’s simply the ability of the meter to communicate with other devices in its vicinity and with the central monitoring station at the utility.

How does the prepaid function work?

Prepaid smart meters, as you can see in the name, is nothing but pay before use meter. The consumer needs to pay before they can consume electricity – think of it like your prepaid phone. You’re basically recharging it to use it. The most common type of prepaid meters have a:

1) Keypad based recharge where the user has to enter the recharge
2) Or using smart cards where the meter is having inbuilt technology to read the smart card.
3) Non-keypad type with communication to the grid where the payment is made online or on the phone and the units are automatically credited to the customer.

There are also a few different types of keypad based prepaid smart meter models. Some models have the keypad and meter in the same unit while other ones are split meters such that the keypad (called the customer interface unit) and the actual meter are split allowing the meter to be kept somewhere safe to prevent tampering while only the CIU is at the customer’s home.

For the utilities, the main purpose of a Prepaid meter is to ensure 100% revenue collection before the electricity is consumed. Also, the utility does not have to send technicians for monthly readings anymore. On the consumer end, they can budget and manage their electricity usage much more effectively.

Adapting to Prepaid Smart Meters has other advantages as well such as real-time energy monitoring and dynamic pricing configuration. The elimination of monthly readings will also help to shrink the carbon footprints of utilities.

For more information on prepaid smart meters and their impact on DISCOMs, you can watch our following video:


If you have any more questions on the functions of a prepaid smart meter or the kinds of products we have developed and are developing at Axis. Please Contact Us or follow us on LinkedIn for more updates

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