The Impact of Advanced Metering Infrastructure (AMI) on African Electricity Utilities

Transcription

1 The Impact of Advanced Metering Infrastructure (AMI) on African Electricity Utilities Kobus van den Berg (Pr Eng) Principal Engineer NETGroup PIESA Workshop, Lilongwe, Aug/Sept 11

2 Overview Introduction What is Smart Metering International Business cases Business drivers for SM in Africa Building a business Case in Africa Financial model Risk management Conclusion

3 You have to be Smart enough to survive in Africa

4 Introduction New metering technology implemented worldwide to address Energy shortages Meter readings Revenue protection Customer service improvement Load management World face two major issues Greenhouse effect Shortage of generation capacity AMI or SM introduced to assist Demanding process for all role players Significant developments in SM arena

5 What is Smart Metering? The European Smart Metering Alliance (ESMA) (Koponen, 2008) defined smart metering as follows: Automatic processing, transfer, management and utilization of metering data Automatic management of meters 2 way data communication with meters Provides meaningful and timely consumption information to the relevant actors and their systems, including the energy consumer Supports services that improve the energy efficiency of the energy consumption and the energy system (generation, transmission, distribution and especially end-use)

6 Smart Metering System LAN Back office systems Controlled load Smart meter server Website Billing & Consumption Communication Medium Customer Internet Meter Customer In-house display

7 Main International Business drivers Asset utilization Energy efficiency Customer Service Operational efficiency

8 Wisdom and watchful eye of the African Scops Owl

9 Main Business Drivers in Africa Low electrification levels Legislation Managing networks Outage Load control Maintenance and extension Improved meter reading/ billing Improved cash flow Improved customer services Reduction in energy losses Energy conservation

10 Electrification Levels in Africa In 2009, an estimated 585 million people had no access to electricity in sub Saharan Africa. Unlike many other regions of the world, under current assumptions, that figure is expected to rise significantly by 2030 to about 652 million an unsustainable and unacceptable situation. (Baziliana et al, 2011) Despite African government policies that kept electricity prices low, some 550 million people, or almost 75 per cent of the population of sub-saharan Africa, still do not have access (Kimani, 2008) South Africa and Egypt have the continent s highest electrification levels at approximately 70 %, while the average for the SADC region is only 20 %.

11 Legislative Drivers The South African Government (Department of Minerals and Energy, 2008) published a notice R773 on 18 July With reference to SM it stated in short that: An end user or customer with a monthly consumption of 1000kWh and above must have a smart system and be on a time of use tariff not later than 1 January 2012 In Europe SM implementation mainly regulatory driven African regulators need to play an active role.

12 Network management Feedback from customer consumption point Supply Failure visible via SM systems Dispatch maintenance teams timeously Load control and limiting Network maintenance and extension information available

13 Meter reading and billing Improved meter reading accuracy Timeous and correct billing Synchronize billing with calendar months Motivation to customers to pay bills Improved utility cash flow

14 Improved Customer Service In-house display inform customers Consumption Tariffs Cost Load limiting Payment reminder for pending disconnections Remote connection/ re-connection Download Prepaid credit

15 Customer information display

16 Look for opportunities like the Grey Heron

17 Non- technical losses Incorrect metering No Metering/ malfunction Incorrect meter readings Tampering with meters Bypassing of meters kw h

18 Commercial losses Incorrect billing Incorrect tariffs Ineffective revenue collection Administrative losses $$$?

19 Total Electricity losses in Africa Source data: USA, Energy Information Administration

20 SM facilities to support Revenue Protection Tamper detection/ reporting 1/2h Profile readings stored Meter failure reported Communication failure reported Automated energy balancing Consumption pattern anomalies detected Remote disconnection if bill not paid

21 Energy balancing Substation SM1 Customers Supply to substation SM SubS SM2 SM3 SM_n Substation SM units = Sum customer SM units

22 SM requires new RP methods NEW RP methods More Data SM

23 New approach to Revenue Protection processes: Fewer sweep audits Frequent meter readings will flag meter tampering Field work more directed at specific cases RP meter data related rather than field work Automated energy balancing Tariff problem detection Reading problems and non payment problems detected easily

24 Energy conservation Customers more aware of their consumption Research studies indicate that customers can, by becoming aware of electricity usage, lower their consumption by up to 10%. (Wood, 2011) Customers relate to consumption and cost of electricity and tend to used electricity more efficiently. Time of Use tariffs can be implemented to assist with demand control and generation shortages.

25 Building a business case in Africa Strategic approach: Investigate and interact with utility management to determine the view, strategies, future vision for the specific utility Carefully determine and evaluate specific challenges in the utility A viability study with the following deliverables will have to be performed: Determine the functional needs of the utility. Investigate and propose a technological solution. Investigate the financial viability and propose a financial model for this solution

26 Financial Model Cost elements Initial capital investments Operational cost Training and appointing new skilled personnel Adapting internal processes Conversion of existing billing and other computer systems Stranded costs e.g. scrapping of existing metering equipment before the end of their usable operating life Loss of revenue due to lower electricity sales Shorter life span of newer technologies

27 Financial Model savings for Utility Avoided costs where tasks are not required any more or reduced Reduced electricity theft Improved network control Electricity outages restored quicker and thus less energy sales lost Remote control of networks and demand control Improved cash flow due to timeous bill payments Reduced losses due to non-payment Improved capital expenditure on network maintenance and extension TOU tariffs can be used to improve cost reflectiveness of electricity. Accurate readings and bills

28 Financial Model, Customer savings Improved energy efficiency due to information feedback to customer on in-house display More accurate readings and bills Reduction in energy cost by using energy in low cost TOU time slots

29 Need the skills of the Pied Kingfisher a master at flight

30 Risk Factors Technical reliability Unreliable communication infrastructure Lack of skills to install and maintain Financial viability Standards and technology aging Cyber Security Customer related issues

31 Conclusion Smart Metering can play a financially viable roll in African electricity utilities A detailed unique business case needs to be developed for each utility. It is vital that an effective financial model be compiled to reflect the cost and expected savings within the utility when SM is implemented. The necessary skills be acquired or contracted to plan, manage and operate the systems The risk factors be managed well to ensure the successful rollout of systems

32 Contact Details Kobus van den Berg (Pr Eng) Principal Engineer NETGroup South Africa (Pty) Ltd. Tel no: Fax no: Mobile:

33 Africa will reward you with its natural beauty