Smart Pay-As-You-Go 2025: Can Tech Finally Fix UK Prepayment Problems?

For years, prepayment meters have been criticised for penalising the very households they were meant to help. High unit rates, limited tariff options, and the constant risk of self-disconnection have made life harder for millions on lower incomes. But with the rollout of smart Pay-As-You-Go (PAYG) technology, 2025 could finally mark a turning point for fairness and convenience in the UK energy market.

Self-disconnection remains a major issue

Despite recent progress, self-disconnection — when homes lose power because their meter credit runs out — still affects around 800,000 UK households each year, according to Ofgem. Many of these incidents happen during evenings or weekends when top-up outlets are closed, leaving families without heat or light until morning.

Traditional prepayment meters rely on physical keys or cards, forcing customers to visit a shop every time they need to top up. It’s a system that has long been criticised for being outdated and impractical, especially for elderly, rural, or disabled users. When emergency credit runs out, supply is cut automatically, often at the worst possible moment.

The rise of smart PAYG meters

Smart PAYG meters are designed to remove these barriers. Instead of topping up at a shop, customers can now add credit instantly through a mobile app, website, or text message. Real-time balance alerts warn when credit is running low, and automatic top-up settings ensure that supply isn’t interrupted.

These features could be crucial in reducing the number of self-disconnections this winter. For example, smart meters allow suppliers to send notifications when usage spikes suddenly, helping customers identify waste or leaks before credit runs out. Some suppliers have even started integrating budget trackers and weekly forecasts within their apps, so households can plan ahead more easily.

Households comparing suppliers through Free Price Compare can also check which energy providers already offer smart PAYG options, making it simpler to find flexible top-up systems with fairer rates and faster setup times.

Better tariff access for PAYG users

Until recently, prepayment customers had very limited tariff options. Most were stuck on standard variable rates, paying more per unit than those using direct debit. But new digital billing systems mean that smart PAYG users can now access the same plans available to standard households, including fixed energy tariffs.

This change could be one of the most significant steps toward fairness. Fixed tariffs give customers certainty over costs for 12 or 24 months, shielding them from volatile wholesale price movements. That stability is especially valuable for households with tight budgets or inconsistent income.

Energy experts say that as smart PAYG platforms become more widespread, suppliers will start offering more inclusive pricing structures. In time, the cost difference between PAYG and standard billing could disappear altogether.

Dual fuel smart PAYG brings everything under one roof

Another major improvement coming in 2025 is the rollout of unified dual fuel tariffs for smart PAYG users. In the past, prepayment households had to manage separate gas and electricity top-ups, often on different schedules and meters.

With dual fuel smart PAYG, both fuels are managed through a single digital account. Customers can top up both balances in one transaction and view combined usage reports through the same app. This not only simplifies budgeting but also helps identify which fuel type consumes the most credit during the week — heating, cooking, or lighting — making it easier to adjust usage habits.

Suppliers such as E.ON Next, Octopus Energy, and British Gas are already piloting dual fuel smart PAYG products designed to work across different meter models. Early feedback suggests that households prefer the control and transparency these systems offer, with fewer surprises and less time spent checking balances.

Technology can only do so much

While the new systems promise to modernise the experience, campaigners warn that technology alone won’t fix all the underlying issues. Many prepayment customers are still in debt, and smart meters can’t prevent energy poverty by themselves. What they can do, however, is make it easier for customers to stay connected, track their spending, and avoid unnecessary disconnections.

Charities such as National Energy Action (NEA) continue to call for better customer support, particularly for vulnerable groups who may not have access to smartphones or stable internet connections. The challenge now is ensuring that every household benefits from smart PAYG’s flexibility, not just those already online.

A smarter, fairer system in sight

By the end of 2025, Ofgem expects the majority of prepayment households to have access to smart PAYG services. If rollout targets are met, this could mark the beginning of a more balanced energy market — one where no household is left in the dark because of outdated technology.

With greater choice, fairer pricing, and real-time visibility, smart PAYG systems could finally close the gap between prepayment and standard energy customers. It’s not a complete fix, but it’s a major step toward a more inclusive energy future for the UK.