Tangible Benefits for Revenue Recovery Using Smart Metering Technology
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1 Tangible Benefits for Revenue Recovery Using Smart Metering Technology Mr Mdu Nzimande Director Engineering Services City Power JOHANNESBURG South Africa
2 Energy Theft A Bigger Challenge than You Think Global Phenomenon Huge Revenue Loss Network Overloading Power Supply Deficit Community Safety Hazard Silent Crime
3 Impact of Energy Theft Quantified R2.3 billion losses in 2013/14 financial year comprising R1.5 billion non-technical losses and R742 million technical losses. Moneyweb: 20 February 2015 Over R2 billion is lost annually by Eskom due to electricity theft. Soweto debt alone stood at R4 billion in the six months to September Fin24: 2 February
4 Energy Theft a demanding environment CoJ Mayor: Cllr Mpho Parks Tau 4
5 City Power in Numbers Sales Revenue Breakdown (%) Customer Base Statistics 5% 30% 57% Large Power User 4,200 Customers 57% of Revenue Approx. R6.6b Domestic 151,200 Customers 30% of Revenue Approx. R3.5b 8% Business 12,600 Customers 8% of Revenue Approx. R928m Prepaid 252,000 Customers 5% of Revenue Approx. R580m Increasing Non-Technical Losses Trend Evident Increasing Non-Technical Losses Trend Reduced Realisation of Revenue Urgent Intervention Required 5
6 What is Smart Metering Smart Metering is more than remote meter reading Smart Metering is the Automatic reading, processing and transmission of metering data Possibility of bi-directional data communication in real-time Support for value-add services and applications e.g. home automation, remote disconnection of supply or load limiting Remote update of meter firmware to enable new services Smart Metering provides Customers with the information they require to become energy savvy and make smarter decisions about energy usage Suppliers with the means to better understand and service their customers Distributors with an effective tool to better monitor and manage their networks
7 Benefits of Smart Metering LPU BUSINESS IMPROVEMENT Domestic Operational Efficacy Nontechnical Losses Billing Accuracy Read Performance Revenue Recovery Load Limiting Real-time Comms
8 City Power s Smart Metering Strategy CHALLENGES FACED BY CITY POWER Meter Reading Revenue Recovery Accurate Billing Reduction of Nontechnical Losses Load Shedding Revenue Recovery and Monitoring Focus on Key Prioritisation areas and targeted initiatives Focus on People and Process Track and Report daily performance Strong Leadership Involvement Implement Contractor Performance Indicators Revenue Protection Technology Install Smart Meters Install Protective Enclosures Centralise Deployment by a Command Centre Stakeholder Management Customer Awareness and Engagement Campaign Stakeholder Engagement Build trust by creating visibility and transparency
9 Smart Metering Solution Overview Customer Web Portal and Phone END USER Water Meter Wide Area Network GPRS / PLC / Wi-Fi Wi-Max / Ethernet RF Smart Meter Meter Data Collection & Management CITY POWER DATA CENTRE Load Switch Home Area Network Customer Display Load Management Consumer Web SAP Interfaces GIS Integration Prepayment Appliance Control Devices
10 LPU Site Normalisation (1) Customer Premises Itron Meter Installation Protective Structure
11 LPU Site Normalisation (2) Customer Premises Itron Meter Installation Protective Structure
12 R 20m R 12 m Protect R 1,12 m Ghost R 370 m Recover Losses Prepaid R 112 m Domestic R 565 m LPU R 92 m P1 Quick Hits Upload Fails RRP Programme Plan PSO VCI Recover Losses: R 2,2 Bn P5 P6 P4 P7 P2 P3 Top 216 Mining Balance Mining Conversions to AMR Mining Affluent Audit Audit: Balance Ghost Finding LPU : 22K Ghost Finding Domestic : 77K Meter Protective Structures WMC MMC Value Chain Improvements(QMS) Project Support Capacity Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
13 Operational Maturity Revenue Recovery Project (RRP) Snapshot Protective Structures LPU Mining Initiative LPU Upload Fails LPU Ghosts Domestic Conversion to AMR Domestic Ghost Domestic Mining Initiative Pre-paid Audits Value Chain Improvements Meter Management Operating Unit Data Analytics & Monitoring Feed-In Recovery 3 rd Phase - Sustainability 2 nd Phase Dom & Prepaid 1 st Phase LPU Project Evolution Increased Meter Reading Performance Reduction in Non- Technical Losses Increased Revenue Recovery Proactive Monitoring and Management
14 RRP Programme LPU Initiatives UPLOAD FAILS Programme Objective System Mismatches Basics Eliminate mismatches between MDMS and Billing System Offline Meters Objectives / Justification Diagnose meters and re-establish communication with MDMS Data Updates Focus Improved data accuracy
15 RRP Programme LPU Initiatives LOSSES RECOVERY Programme Objective
16 System, Data, Customer Engagements System, Billing, Work Portals (Alarm monitoring) RRP Project Structure ENGINEERING SERVICES DIRECTOR LPU, DOMESTIC & PREPAID SMART METERING PROJECT MANAGERS PMO SUPPORT LEADS PLANNING/ PRE-AUDIT SMART METER EXECUTION PROTECTIVE BOX EXECUTION REMOTE & FIELD QC PROJECT SUPPORT AND REPORTING OFFICE Legal & Investigations JMPD City Power Depots Meter Contractors Metering SPs Back Office Box Contractors Supply Chain Stores Field QC Strategic Partners
17 RRP Project Progress End June 2015 LPU LOSSES RECOVERY LPU UPLOAD FAILS 30% REVENUE RECOVERED LPU LOSSES PREVENTION 77% LPU Upload Fails LPU Focus & Mining R 130m LPU Ghosts R 142m 56% LPU Ghosts LPU Focussed LPU Mismatches LPU Unconfirmed LPU Upload Fails R 145m LPU Conversions LPU Mining Feed-In Recovery LPU Initiatives Completion Progress Portion Clean-up Feed-In Recovery R 232m Total = R 649m
18 RRP Impact on Non-Technical Losses Trend Non-Technical Losses Trend Roll Out of Initiatives in LPU sector shows positive impact Arrest in Increasing Trend Revenue Recovery Initiatives to provide further impact on overall losses trends Maintain Gains Realised Roll Out of initiatives in Domestic & Prepaid Base Proactively monitor & identify anomalies Protective Structure Roll-out
19 Summary of Lessons Learnt 1 Data Quality 2 Integration 3 Processes & Controls 4 Performance Monitoring Manage data quality at all stages of the normalization process Closely manage integration points at various levels and across value chain to avoid gaps Define and control processes and subprocesses at a programme and project level Daily monitoring and response to anomolies through Dashboards & KPIs 5 Contractor Competence 6 Protective Enclosures 7 People 8 Change Management Verify formal competencies and ensure the right skill level Installation of protective structures must be done in parallel with meter installations Enable resources with capability, competency & commitment to ensure delivery Change takes time and new projects need to gain momentum before results are seen
20 END
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