Progress Energy wants to offer customers a new bill payment option that goes back to the early days of rural electric companies and is expected to save a typical household more than $100 a year.
The method, pre-paid billing, is available from other industries, such as wireless service providers, but hasn't been offered by most power companies in decades, although it is still offered by some rural electric cooperatives. Instead of paying after the electricity is used, the customer pays in advance.
Raleigh-based Progress hopes to offer the experimental payment method to 1,000 customers in the Carolinas this year, once the program is approved by the N.C. Utilities Commission. Progress notes in its filing that savings up of 10 percent to 15 percent can be expected, based on experiences with similar programs in other parts of the country.
The savings from the voluntary program are expected to come from increased awareness of energy use habits.
"When there is more conscious use of electricity and its cost, consumers tend to be more judicious in how it's used," said Progress spokesman Mike Hughes.
However, Progress will have to convince the state utilities commission of the worthiness of an efficiency program that will charge customers fees and eat into the potential savings. The program will include a $1 transaction fee for credit/debit cards online, and a $1.99 transaction fee charged by the vendor for making cash payments.
If approved, the program will be available on a limited basis at first. In Raleigh, customers in five zip codes would be eligible: 27601, 27603, 27606, 27609 and 27610.
Progress also plans to offer the prepay program in one to two zip codes in Fayetteville, Spring Lake, Jacksonville and Florence, S.C. Good wireless reception is required for the utility smart meter to function reliably.
The prepay billing program would largely be paid for by federal stimulus funds, which would cover $3.3 million of the $4.1 million cost of the program. The rest would be paid for by all customers in their bills. The rationale for spreading the cost around is the same as all energy-efficiency programs: All customers benefit from energy policies that reduce the need to build costly power plants.
The feds would cover the cost of new two-way utility meters, third-party measurement and verification, and about 250 in-home electricity use displays that will be given away on a first-come, first-served basis. The displays will show daily, weekly and monthly usage and the remaining balance in days and dollars.
Customers without the in-home displays would receive alerts by email, text or by phone to let them know when their accounts are running low. If the account runs out of money, the customer's service will be cut off. However, reconnecting would not include the usual $30 fee in North Carolina or the $15 fee in South Carolina.
Prepay programs are offered in this state by the following electric membership corporations: Brunswick EMC, Central EMC and Piedmont EMC.
