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Payment Matters? - An Exploratory Study into the Pre-Payment Electricity Metering

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  • Brutscher, P.
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    Abstract

    In this paper we look at the role of pre-payment (in the context of prepayment metering) for household electricity consumption. Using a matching approach, we find that households paying their electricity up-front tend to consume no less electricity than households paying ex post. This is despite facing a higher tariff and higher transaction costs. In the second part of the paper, we explore to what extent this finding can be linked to an increase in payment flexibility under a pre-payment regime. Using data from the main electricity supplier in Northern Ireland (NIE Energy), we explore how people top-up their pre-payment meters and whether there is a link between people's top-up behaviour and their electricity consumption.

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    File URL: http://www.econ.cam.ac.uk/research/repec/cam/pdf/cwpe1124.pdf
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    Bibliographic Info

    Paper provided by Faculty of Economics, University of Cambridge in its series Cambridge Working Papers in Economics with number 1124.

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    Date of creation: 10 Feb 2011
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    Handle: RePEc:cam:camdae:1124

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    Web page: http://www.econ.cam.ac.uk/index.htm

    Related research

    Keywords: Pre-payment Metering; Top-Up Behaviour; Demand Management; Pain of Paying.;

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    1. Brophy Haney, A. & Jamasb, T. & Pollitt, M.G., 2009. "Smart Metering and Electricity Demand: Technology, Economics and International Experience," Cambridge Working Papers in Economics, Faculty of Economics, University of Cambridge 0905, Faculty of Economics, University of Cambridge.
    2. Looney, Adam & Kroft, Kory & Chetty, Raj, 2009. "Salience and Taxation: Theory and Evidence," Scholarly Articles 9748525, Harvard University Department of Economics.
    3. Andrea Ichino & Fabrizia Mealli & Tommaso Nannicini, 2008. "From temporary help jobs to permanent employment: what can we learn from matching estimators and their sensitivity?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 23(3), pages 305-327.
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