Prepayment Metering System

Transcription

1 0 Prepayment Metering System Contents 1 History of prepayment in South Africa Overview of the Manage Revenue Value Chain: Prepayment Overview of the Prepayment Metering System Benefits to the utility & customers Critical Success Factors Sustainable Prepayment System Cost indications Concluding Remarks 1

2 History of Prepayment in Eskom 2 In 1988 Eskom developed the "Electricity for All" concept Customers had to be supported by limited Eskom resources. The system had to operate with minimal management intervention and optimal maintenance. The standard billing system required a lot of day-to-day management to process accounts and to maintain connections and disconnections. Many of the areas where potential customers reside had almost no infrastructure. History of Prepayment in Eskom (continued) 3 There were no fixed addresses in the new informal settlement areas. There was high unemployment, no bank accounts and no postal services Many customers did not understand bills Eskom facilitated the development of the basic prepayment electricity system which is still in use today More than 5 million prepaid meters installed to date in South Africa (Eskom and Municipalities) 3,6 million for Eskom increasing by approximately annually. 2

3 Prepaid experiences learnt the hard way 4 Orange Farm Informal Settlement 70 km south of Johannesburg was first project in 1990 Concrete poles were used Covered 11kV conductor was used 60 Amp meters installed in shacks Assumption that meters were foolproof Meters designed to go on a free supply mode when faulty or reached max life span Prepayment Value Chain 5 MANAGE REVENUE CYCLE KEY VALUE CHAIN (MRC VC) CONVENTIONAL BILLING PROCESSES REVENUE PROTECTION PREPAYMENT PROCESSES 3

4 Prepayment Support Structure 6 MRC VC Prepayment Prepayment Development Department SLA Enterprise Architecture BASC SLA Cash Management Research & Development Key Management Centre Systems Support Info Architecture CC&B OVS Support Financial Controls Recon s & Settlements High level overview of Value Chain 7 MRC VC: Prepayment Prepayment Meter Management Off-Line Vending Online Vending Vending Support Management Manage Free Basic Electricity Cash Management Revenue Loss 4

5 Prepayment Balance Score Card 8 PREPAYMENT KPIs Western Southern Eastern N West Central North Total ActiveCDU s without Uploads (Never Uploaded) ActiveCDU s with last uploads morethan a monthago ActiveCDU s - uploads in the last monthbut not in the past week Total Number of New Customers 306 1, , ,299 5,628 Number of customers blocked in online vending system Resolved Unallocated Transactions ,323 Sales Upload Errors (Number of files in error) Customer, Accounts and Meter ToDo's Allocated to Account Operations Personnel , , ,118 Allocatedto Customer Services Personnel 2,529 1,695 20,187 12,817 30,352 56, ,699 Transactional ToDo's Allocated to Account Operations Personnel , ,022 Allocatedto Customer Services Personnel 5, ,141 26, ,098 Key Functionality Working Well / No Backlog Potential Issues / Some Outstanding Items / Backlog to be addressed Issues / Outstanding Items / Large Backlog to be addressed Overview of the Prepayment Metering System 9 Allows customers to pay for a credit token in advance Enables automatic switch off if credit in the meter expires This has the potential to: Increase cash flow for utility Lower operating costs and management complexity Prevent bad debts and recover arrears from billed customers (Convert billed customers to Prepayment System) Sustainable solution with community involvement 5

6 Prepayment System Components 10 Prepayment is a strategic tool in managing revenue within a utility Management System Computer system with database, management tools, reporting and security features Vending outlets Computer based terminals where tokens are sold. Prepaid Meters Electronic meter with display, keypad and disconnect switch Typical Prepayment System 11 Utility Management Systems (SMS) Customer Data Vending Systems (Dispense Tokens) (Credit Dispensing Unit) Token / Voucher Printer Customer data card Vending Transactions Prepaid Meters Installed in customer s house 6

7 Electrification new connections in 2006/7 More than 3,4 million households electrified since ,500,000 3,250,000 3,000,000 Cumulative number of homes electrified Free basic electricity since 2003 Free 50kWh to poor households 97% of local municipalities participating in this government initiative Improved the lives of more than one million people 2,750,000 2,500,000 2,250,000 2,000,000 1,750,000 1,500,000 '2002 '2003 '2004/5 '2005/6 '2006/7 Standardization of Prepaid Meters 15 Proprietary Meters Different meters from different suppliers Different tokens proprietary tokens Each supplier had own vending system Different meter sizes When meter fails, same product used to replace product that failed. Strong possibility of being locked into one supplier Current Standard Transfer Specification (STS) Meters Standard Common Base Standard tokens Standard vending systems from different suppliers. Faulty meters can be interchanged Eliminated the possibility of being locked into one supplier 7

8 Current Meters in use 16 Meters from Different Manufacturers Common Base for all Meters Different meters fit onto the Common Base Installation of Prepaid Meters 17 Meter with built-in Ready Board in a Shack Meter installed outside the House for easy maintenance access 8

9 Critical Success Factors (CSF) 18 Know why you are implementing a prepayment system Customers should understand your service philosophy Set clear functional and technical specifications Set criteria for manufacturers to qualify for tender Validate and update customer database regularly Keep the implementation process simple Develop sound procurement strategy Set a vendor selection criteria Strong supporting structure Vending management Energy balancing Sustainable Prepayment System 19 - Customers - Vendors - Suppliers -Internal -External - Standard Protocols 9

10 (CSF): Engage Customers 22 Customer education Communication with customers Continuous community involvement Accessibility to handle customer queries (CSF): Promote prepayment metering system 23 Prepare a customer oriented marketing strategy before system installation. (Awareness campaign) Downplay benefits to the utility while highlighting benefits to customers Target different customer profiles Market the benefits continuously Solicit the support of influential Leaders to reinforce the benefits for customers. Nelson Mandela 10

11 CSF: System Support Structure 25 Maintenance Finance Data Technical Training Support Structure Revenue Protection Technology Enhancement Human Resources Project Management (CSF): Energy Balancing 26 Distribution Line or Busbar Bulk/Stats Metering Vs Township/village Sales in monetary value are converted to kwh Sales Non-Technical Energy Losses = Energy Delivered - Sales - Technical Losses * technical losses usually 10% in Eskom 11

12 (CSF): Vending Management 27 Introduction of Online Vending System Vending Strategy & Future Direction 28 Step 1 Step 2 Step 3 Traditional Credit Vending Upfront Vendin g Onlin e Vendi ng New Vending Channels High Shortages Under Banking Recon s Problems High Fraud Risk High Revenue losses Ghost CDU s Up-front Banking Reduced Financial Risk exposure Automated energy units top-up Easy Recon process Electronic Banking Own POS equip nt Reduced Risk 3rd party Collectors Increased footprint < convenience Internet Cell-phone ATM Swipe-Machines Scratch Cards EasyPay-Vouchers We are here 12

13 Online Vending System? 29 The online vending system, simply described, allows a customer to purchase prepaid electricity via a remote terminal located in a supermarket store, ATM, cell phone or one of the existing vending stations. This system enables electricity to be vended from the main server in real-time. The system enables customers to purchase tokens nationwide from a central data base via a wide range of channels. This allows customer to purchase their electricity tokens from a broader distribution network. Promotes easy access, convenience and satisfaction Online Vending Infrastructure 30 Secure Eskom Environment External to Eskom Customer Care & Billing System Database TX Uploads Customer Data Downloads Online Vending Server Database National Agent - Server Terminals Sub Agents/ATM s TX Uploads Credit Downloads TX & Data Up/Download System Master Station Bank Bank Deposit SAP Firewall Offline Credit Dispensing Units 13

14 Online Vending Model Configurations 31 Multi -Client Vending Vend ing Client Vending Client Vending Client X M L V e n d Gateway Vending Online Vending Terminals in all Regions XMLVend Client Vending Online Vending Server Vending Client Server Proprietary Region 1 Region 2 Region n Vending Client Expansion of Vending Outlets 32 Online Vending Server Meter number Tariff Index Supply Group Codes Account number Stand Number Connection fee Customer details Arrears balance Retail Chain Stores Engage National Agents using Merchants Automatic Teller Machines (ATM s) Internet Contact Centre 14

15 Benefits of Online Vending 33 Improved data integrity Improved tariff management Increased vending footprint Improved customer convenience Improved financial risk management Improved financial control and sales data Increased business opportunities for small business Customers able to purchase tokens nationwide from a central data base 34 Prepayment Metering system: Cost indications Item Std Common Base Meter (including the base) Std Split Meter: (Key pad and separate meter box) Credit Dispensing Unit (including Vending software) System Master Station (including software) Online Vending Solution (Similar to Eskom Model) Costs in R (approximate) Costs in $ 7) Comments Based on 2007/8 average costs Based on 2007/8 average costs Based on 2007/8 average costs < Based on 2007/8 average costs < 65mill 9mill Scalable according to requirements, size and local dynamics 15

16 Conclusions 35 The key drivers for implementing this system should be clearly defined Customer requirements and local circumstances should be used to select the appropriate model and technology Prepayment solution is only as good as the company or utility s management system Do not implement new technology until it is tried and tested Never implement a Proprietary System! Engage with other prepayment metering system users to learn from their experiences 16