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Smart meters take bite out of electricity theft

"Smart meter might cost $250 in the United States, but in a developing country the same device could cost $1,500."



National Geographic13 September 2011


PA’s Gregg Edeson, global energy expert, is quoted in National Geographic.  Gregg comments on the problem of electricity theft, unbilled consumption and uncollected revenues and how smart meters can be used to combat these issues in emerging markets.

The article reports that some of the biggest culprits are large residential, commercial, and industrial consumers who avoid paying their fair share of electricity, often by colluding with meter readers, current or ex-utility employees, or third parties. In some pockets of South Asia, Sub-Saharan Africa, and the former Soviet Union, losses reach 50 percent.

Commenting on the cost of fixing this situation, Gregg says smart meters are definitely one of the tools being considered to fight electricity theft in developing countries. But, he cautioned, "At the end of the day it's still an expensive alternative. You have to have a solid business case, you don't just jump into this lightly.”

Gregg points out that a “Smart meter might cost $250 in the United States, but in a developing country the same device could cost $1,500 because of low volumes and necessary rewiring.”

Gregg also points out that “Devices are fairly tamper proof; if meddled with, they send a distress signal that notifies the utility on a nearly real-time basis.”

Commenting on where smart meters can be most effective, Gregg says smart meters can "Absolutely be cost-effective if they are placed in a strategic manner," such as on a distribution line feeding commercial and industrial customers.

Gregg worked in Uganda to develop a pilot program using smart meters and points out that such a system helps utilities improve the performance of the network and it "Helps keep employees honest, because they know the energy usage overall is being monitored."

In Uganda, Gregg says that Millers constituted the biggest portion of electricity theft “They would transport their electric milling machines on the backs of trucks, and mill alfalfa, barley, and wheat on site, clamping illegally to power lines.”

Gregg concludes that “While placing smart meters on some high-use customer premises is an option, other alternatives should be considered as well … such as trying to understand the collusion that's occurring and provide incentives to build a more trustworthy utility inspection team. There also are physical things a utility can do to prevent theft, such as securing meter boxes, installing tamper proof cables and using barbed wire to discourage clamping onto power lines.”    

You can read the article in full here.

Contact the energy and utilities team

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