Faced with a huge customer debt profile and revenue collection challenges the Power Holding Company of Nigeria (PHCN) introduced the prepaid meter in 2006 to aid in revenue collection. In this paper, we examine the impact of the pre-paid meter on revenue generation. The electricity bills of consumers located in Ugbowo, Benin City, Edo state Nigeria that was previously on the post-paid billing system and later changed to pre-paid billing system for 15th January, 2007 to 15th January, 2008 and 3rd February, 2007 to 21st January, 2008, respectively were used in the analysis. The total load assessment for a threebedroom home occupied by a consumer was carried out. Microsoft Excel 2003® was then used to analyze the data.

The analysis reveals that while the introduction of the prepaid meter increases the revenue collection, it reduces revenue generation because it is reliability based. Improving power reliability will increase revenue generation in the prepaid scenario. It ensures that the consumer pays only for energy consumed and not the estimated bill in the post paid system as can be seen in the large standard deviation in the units of energy consumed. The number of registered customer in the first and second quarter of 2008 in Nigeria is 4731009 and 4,771,035, respectively, while prepaid meters installed are 93134 and 99317, respectively. The differential in registered customer between the two quarters is 40,026 while differential in installed prepaid meters between the two quarters is 6,183. One would expect that the differentials will at least be equal to the 40,026 newly registered customers. This can be attributed to dwindling revenue due to the dependence of the prepaid system on reliability resulting in the reduction of its installation.