connecting low-income urban...
TRANSCRIPT
Connecting Low-Income
Urban Neighborhoods
Simone Lawaetz
USAID
December 16, 2010
Rio de Janeiro, Brazil
Iraq
Mumbai, India
Maharashtra, India
Which line is mine?
Why do we care?
Impact of Electricity Theft on Utilities
• Contributes to poor commercial performance– Range of losses encountered (e.g., 98% in slums AES)
– Slums consumes around 21% of total Reliance Energy‟s sale.
• Overloaded systems/ Damaged equipment
• Corruption practices
• States have to make up the difference in power subsidies, impacting more social investments, such as health and education
Why do we care?
Consumer/ Society• “Free” electricity is usually not free. By encouraging legalized
electrification and bypassing illegal operators in Manila, effective
tariffs often dropped from roughly $0.09/Kwh to $0.045/Kwh
• But, can also be „wasted‟ if not being paid for
• Socio-economic development from reliable, high quality
service
• Improved health and quality of life
The Next Generation: Percentage of Male and Female Population,
Aged 0-12, by Slum and Non-Slum Residence
Technical and Non-Technical Loss Reduction
• Technical losses: myriad points of attack. Conventional solutions can generally be applied.
• Non-technical losses can comprise one or all of the following:
– Theft by registered customers
– Theft by illegal consumers
– Graft/collusion with company personnel
• Programmatic and technical approach to non-technical losses will depend on which type that they are.
Initial Identification of Source of Losses
25%
15%
10%
35%
10%
5% MT & LT technical losses
Meter malfunctions
Theft and illegal
connection
Billing/reading errors
Non-payment
Miscellaneous
Typical example (derived from India): this
DISCO might attack technical losses and
internal incompetence first; then move on to
theft and non-payment.
10
Meter tampering
Placing magnetsMechanical impediment to rotating
disk Meter tilting
Meter by pass by illegally connecting to switch before meter
Other ways to steal electricity
11
Equipment used to falsify meter
seals
Falsified meter gear parts
Who needs a meter?
12
Wire tapping
Flying connectionsFishing pole connections
Outline
• Technical Solutions
• Socio-Economic Solutions
• Group Exercise
• Case Studies
How can electricity theft be reduced?
14
Public Outreach
Unique
Solutions
for each
case
Technical Solutions Non-Technical Solutions
Meters and Meter Enhancements
Cables
Specialized Software and
Advanced Technologies
Load Limiters
Unique Configurations and Techniques
Management
Legal and Regulatory
Technical solutions
o Sweeps/Loss reduction swat team
o Low cost service drops and “tamper proof” meters
o Master meters (“public fountains”)
o “Perimeter” service (often temporary)
o Pre-payment meters
o High tech anti-theft cables
o Customer usage monitoring
Sweeps/Loss reduction swat teams
• Most companies start with this approach, doing thousands of “sweeps” a year.
• It is costly and frustrating; illegal connections reappear in minutes.
• Yet, still necessary, even in successful socio-technical approaches. Human nature reverts to the “norm” when access is denied.
• Vigilance and follow through remain very important.
Steal energy: go to jail!
PS: It‟s not that simple!
“Low Tech” solutions can be effective
BrazilIndia
Essential: Meters must be visible and “clean” (easy
to spot irregular situations)
More low tech solutions
• Standard low cost service drop kit for all conditions
• Shortest possible low voltage network, individual service cable (concentric/ coaxial) from the pole to individual meters.
• Load limiters– Justification is that illegal
commercial activities should not receive the subsidized tariff
– Negatives: Limits micro-businesses in the home or to add certain appliances.
LYDEC “Temporary” Perimeter
Electrification in Morocco
3 700 000 pers en domicil.
800 000 pers par B.F
Logement
Réseau Lydec
Compteur collectif
Réseau privé
Compteur
individuel
Household
Lydec’s
Network
Collective
meter
Network
managed by
local
intermediary
Individual
meter &
circuit
breaker
LYDEC
MNGT
DELEGATED MNGT to LOCAL
OPERATORS
Bringing support to
social intermediaries
Decreasing investment cost
Evaluating the "value" of
improved services with the
population
Adapting service
delivery model to
government restrictions
Source: LYDEC Morocco
Perimeter Service: Individual Meters
• Quick and effective in short term (after revisions)
• Limits liability of disco; avoids right of way problems
• Losses reduced but opportunities for theft still exist (from other customers)
Source: Meralco, Philippines
Prepayment systems
• Experiences: South Africa, Argentina, Venezuela, Colombia
• Help consumer to control amounts spent on electricity (no overrun leading to disconnection). Significant reduction in usage and expenditures (e.g., 40% in Argentina).
• kWh can be purchased in very small quantities according to disposable cash on hand
• Can be combined with electric outlets for simple but “complete” electric “kit”
In-house keyboard for input of
prepayment code and digital readout of
kWh remaining (Caracas)
Early version of “ready board” +
pre-payment readout (S Africa)
High tech anti-theft cables
Multiple
meter box
Low tension
network and
communicati
on cable
Distribution
Transformer
Medium
Tension 15 kv
network
Service drop to
customer
Source: AMPLA, Brazil
System is costly but
virtually impossible
to tap in illegally
Elevated meters
require remote
reading capability
Customer usage monitoring
• After system upgrade and individual meters installed, customer usage can be monitored easily.
• With rigorously used data monitoring systems, company can identify potentially “irregular” situations that might signal reversion to theft.
• Monitoring can also signal usage “out of control” that might lead to inability to pay in the future.
• In either case, a company can visit the consumer to take “corrective” action (either disconnection or helping with energy savings).
Socio-Economic Solutions
o Social Partnership (“you pay, we deliver”)
o Know your community
o Community based service “agents”
(intermediaries)
o Making it easier to pay connection fees/bills
o Energy efficiency assistance; internal
improvements, e.g., rewiring for safety, efficiency
o Economic development assistance
o Community and individual legal assistance (e.g.,
for land title or equivalent)
Social Partnership
(“We deliver You pay”)
• The partnership is fundamental tool for areas where downward spiral has created mistrust on both “sides”
• “We deliver” means:– Reliability of service: especially important where
distribution system has been allowed to deteriorate severely (Haiti, DR)
– “Power like the others receive,” i.e., 24 hour service
– Improved safety
• A means for gauging success in delivery is needed (community interface)
Know your potential customer
• Consumption levels
and habits
• Family budget
control and
payments
• Physical condition of
home
• Gender issues
Brazil (Rio)
Brazil (Salvador)
India (Ahmedabad)
Philippines/ Manila
South Africa/ Cape Town
0
50
100
150
200
250
300
Brazil (Rio) Brazil (Salvador) India(Ahmedabad)
Philippines/Manila
South Africa/Cape Town
# k
Wh
/HH
/mo
Location
Average Slum Electricity Usage
#kWh/HH/mo
Community intermediaries
• Companies need safe access to deliver services
• Community intermediaries ease access by:– Explaining the compact and
gaining acceptance
– Assisting with signing up customers
– Ongoing assistance in helping resolve problems before they escalate
• Intermediaries can be CBOs and NGOs already active in the community. Must be respected and trusted themselves.
Women often make up the
majority of members in
CBOs and NGOs.
“Agents” as “Stethoscope” on the
Community (Brazil)
• Energy safety issues.
• Potential errors identified in customer classification.
• Customers who have not received their utility bill.
• Suspected cases of theft or third-party energy
suppliers.
• Needed extensions of distribution grid system.
• Theft of installations/equipment.
Making it easier to pay
• Subsidies and payment
assistance for connection
costs
• Assistance in accessing low
income tariffs
• Improved mechanisms for
payment
• Creating efficient
consumers
Making connection cost affordable
• 10 year, low interest loans for service drop, meter,
low voltage protection device (avg cost
$166/customer) (Medellin)
• Micro-credit schemes made available to reduce HH
budgetary strain and initiate productive economic
activities
• Donation of service drop (other ratepayers or the
government pay)
Tariff related actions
• Social tariff: only applicable to consumers
qualifying for social safety net (Brazil,
Colombia)
• Free electricity for consumption under cap:
e.g. 50 kWh per month in South Africa
• Prepay tariffs may require regulatory action
depending on tariff structure (e.g. prepayment
is on per kWh basis, many tariffs are two part,
one part for fixed costs.)
Energy efficiency assistance and internal
improvements
• Key: Affordability = Sustainability
• Energy use and efficiency education
• Internal household rewiring for safety, efficiency
• Inefficient refrigerator replacement
• Compact fluorescent lights
• Attention to other energy needs
Complaint resolution
• Community agents (personal visits)
• Customer service centers closer to or within needy areas
• Improper billing
• ESCAs: Energy Services Community Associations to
educate, empower, lobby, mediate consumer interests
with company, negotiate debt restructuring (Georgia)
GROUP EXERCISE
You represent a utility that is struggling with theft in low-income urban areas and is considering implementing a „regularization‟ program. As a first step, you are meeting with a focus group of slum consumers about becoming legal customers and want to get their reaction to this as well as collect information to properly design the program. In your group, discuss what key information you want to gather and why.
Exemplary Results • AES/ Brazil: Anti-theft technology plus customer affordability
focus. – Payback 1.4 years and ROI 276% although payment performance
was only around 50%. Regularization alone dropped consumption by 20% and efficiency measures contributed another 20% reduction on average.
• AMPLA/ Brazil: Focused high anti-theft tech approach with unique cable configuration, elevated electronic meters (EMs), consumption readout in home, etc).– Allowed investment actually reduced tariffs by 1.23% in the 2009
regular 4-year tariff review. Theft reduced to <5% and non-payment virtually eliminated where technology applied.
• LYDEC: Temporary perimeter with mini-grids with sub-meters. – Approximately 93% of the communities were electrified with
payment performance around 96% of billing and project payback was about one year.
More Exemplary Results
• ESKOM/ S. Africa: Tour de force approach. Comprehensive loss reduction program with energy balancing, EMs with remote reading and disconnection capability, aerial bundled cable for MV and coaxial cable for LV, split prepayment meters, etc.– 3.7 M prepayment meters (of various types) installed country wide
(40% in slums or 1.4 M customers); former increasing total losses (50% increase in 5 years) were stabilized at <6% (of which non-technical loss ~2.2%); overall collections 85% (non-payment ~15%)
• EDM/Mozambique: Prepayment system plus management improvements– Number of customers more than doubled in 4 years; the collection
rate improved from 75% in 1995 to 94% in 2005; average consumption per customer dropped from 148 kWh to 124 kWh while total distribution losses decreased from 43% to 18% between
1995 and 2005.
Non-starters?
• Cases where low electrification rates make it hard to justify serving low income when higher income/consuming households and businesses cannot gain access
• Cases where there is no cost recovery and/or no source of funds for infrastructure
• Cases where graft is so endemic that there is no chance of success
• Cases where distribution companies have no incentive to begin tackling the problem.
Optimal Feeder Technology Toolkit
Components:
– PPT overview
– Technology descriptions
– Case studies
Can be found at:
http://www.energytoolbox.org/oflc/
