Prepayment vs Conventional Metering

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Prepayment vs Conventional Metering
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INTRODUCTION

• Paper to stimulate arguments.
• Prepayment here to stay.
• Question Is it cost effective in all cases?
• Financial Control?
• Immediate feedback.
• Number of pros and cons.

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The Newcastle Experience

• Old traditional area.
• Consumers /- 13000.
• Prepayment /- 1100 Split meters.
• Total losses 4.89 - 5.2.
• Metering kiosks on pavement and meter rooms.
• Tampering Lock or kiosk damaged. Meter reader
  reports.
• Conventional meters up to 30 years old.

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Advantages of Prepayment Metering to the
Municipality

• Municipality receives payment up-front.
• No electricity meter readings. Water?
  Confrontation?
• No processing of accounts. Token cost?
• No posting of accounts. No lost accounts. Water?
• Eliminate bad debt. Only if enforced.
• Elimination of disconnection cost.
• Vendors 24hour service.

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Advantages to Consumer

• Budget manage more effectively for a while at
  least. See-through meter box.
• Control electricity usage, only if serious.
• No re-connection fee.
• No deposit.
• Convenience of purchases. Payment systems.

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Disadvantages to the Municipality

• More prone to faults cost of repairs
  scrapping of meter.
• Lightning damage 27 failures in 3 years.
• Theft more with prepayment. People try to beat
  the system.
• Theft increases cost.
• Even now stealing the prepayment meter.
• Lack of trained staff. No system management.
• 7. Meter-readers replaced by higher paid staff.

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Disadvantages to Municipalities (continued)

• 8. Prepayment meters require more attention.
• 9. Regular inspection system audit downloads
  bridged out meters.
• 10. Return on investment small 80 units.
• Changing technology.
• Requests more flexible tariffs trained staff.
• Meter-readers still required for water.
• Paying vendors.
• System must be administered on a daily basis.

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Disadvantages to Consumers

• Unit costs are higher after breakeven point.
• Up to three times on capital layout.
• Frustration on token rejection.
• On system change-over double payment in first
  month.
• Conventional meter, lifecycle constraints service
  options.

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Conclusion

• Over 30 years, prepayment is twice the cost.
• Opportunities - flexibility - pay in advance -
  control spending.
• If cost of maintance and disadvantages to
  Municipalities are taken into account, the system
  might be just too expensive.
• Social needs, requirements and convenience might
  in the end be the deciding factor.
• Prepayment metering is here to stay.

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THANK YOU
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Questions?