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Compulsory Prepaid Electricity proposed for all South Africans

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Eskom CEO Brian Molefe is of the view that legislation in South Africa should be changed, making it standard to use prepaid electricity.

Speaking to MPs during a parliamentary briefing with Eskom and the Select Committee on Communications and Public Enterprises about the power utility’s tariff hike for 2016 to 2017, Molefe said prepaid electricity would go a long way towards curbing Eskom’s losses due to non-collection and illegal electricity connections.

“I know it’s been said in the media that I – Brian Molefe – am not supposed to say anything about energy policy,” he said in reference to a report that National Treasury was unhappy about his utterances on independent power producers.

“If you would allow me to just say as a lowly official – we think prepaid electricity should be standardised. If we have it through the entire country it would resolve our problems, and the shortest way is by introducing legislation on prepaid.”

Molefe also proposed that Eskom “step in”, install prepaid meters and collect revenue and then pass on to municipalities the portion of collections due to them. “That will take away the burden of collection. So the municipality will still get their revenue, but Eskom becomes the collecting agent.”

Molefe added that Eskom would also be happy if legislation is introduced that allows the utility to appeal energy regulator Nersa’s decisions. “Currently if one party is unhappy – Eskom in this case – about an aspect in the Nersa ruling there is no way we can appeal, except maybe to (go to) the courts. We’d be happy if we could appeal if we feel there was an error in the calculations.”

Consumers who receive power from municipalities paid 7.64% more for electricity since the beginning of July. This comes after Nersa approved a 9.4% hike for 2016 to 2017.

Source: South Africa: Molefe Moots Compulsory Prepaid Electricity for All – allAfrica.com

Prepaid meters increase collection rate

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Eskom has already seen a ZAR39 million improvement of revenue collection in Soweto over a year-long period after it installed and converted customers to split prepaid meters.
The figure is cumulative from the 2014/15 financial year up to 30 June 2016.

The revenue collection levels for customers – including Large Power Users (LPU), Prepaid Power Users (PPU) and Small Power Users (SPU) and excluding bulk suppliers – are currently at 48%.

Soweto has approximately 181 000 customers, about 65% of whom are customers who are on conventionally-billed metering system and the remainder are on conventional prepaid metering system.
We have installed over 41 628 split meters and converted 24 746 to prepaid and are planning to accelerate the roll out of prepaid meters in Soweto.

The conversions of the meters have also resulted in a gradual increase in sales.

Eskom is currently installing prepaid meters in Sandton, Midrand, Soweto, Kagiso and other areas around Gauteng.
This is in order to enable revenue collection and address Eskom’s debt collection challenges.

In Sandton and Midrand alone, Eskom connected close to 14 700 meters from March 2016 to date.
The company aims to complete the installation of 32 000 prepaid meters in Sandton and Midrand by end of March 2017

Source: Prepaid meter conversions in Soweto improves revenue collection by ZAR39 million | BizNis Africa

Cape Town prepaid electricity contract reawarded

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Prepaid electricity token distributor Cigicell, a subsidiary of JSE-listed Blue Label Telecoms, has been reawarded the contract to distribute prepaid electricity tokens on behalf of the City of Cape Town.

“We have been distributing prepaid electricity tokens on behalf of the City of Cape Town for the past five years and are delighted to have been reawarded the contract, which will begin on September 1,” says Cigicell CEO Alan Kodesh.

“The City of Cape Town has the largest municipal footprint of prepaid electricity metres in South Africa. We are proud to continue working with the city to maintain and improve service delivery levels to their prepaid electricity customers,” Kodesh states.

Full Article: Cigicell reawarded prepaid electricity contract in Cape Town

CIG agrees to buy prepaid meter maker for R850 million

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CAPE TOWN – Consolidated Infrastructure Group (CIG) on Thursday (11 August) said it had agreed to buy Conlog, a manufacturer and distributor of prepaid electricity solutions, for up to R850 million.

The purchase price comprises an initial payment of R700 million and a further amount of between R50 million and R150 million depending on Conlog’s earnings for 2016.

Conlog designs, manufactures and sells prepayment and smart electronic metering devices, and provides utilities and municipalities with services including revenue management and protection, prepayment with smart load control and load management.

CIG said in a statement that the importance of pre-paid meters had been demonstrated across Africa.

The purchase of Conlog would extend CIG’s products and services to its utility, municipality and commercial clients beyond the generation and transmission sectors. CIG added that the acquisition would extend its presence across all segments of the power sector value chain……

Full Article: CIG agrees to buy prepaid meter maker for R850 million

R64 300 each for Tshwane’s Smart Prepaid Meters?

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A payment of R950 million to Peu Capital Partners by the Tshwane metro was temporarily halted by the North Gauteng High Court on Wednesday.

The decision by the court followed a successful urgent application by the civil rights organisation AfriForum, which argued the municipality had tried to “sneak through” the massive payment to Peu with the knowledge that the ill-fated contract for the city’s smart pre-paid electricity was not above board.

The court made an interim order preventing the payment of amounts totalling R950 million to Peu, giving the Tshwane metro until 5 July to give reasons why the order should not be made permanent.

AfriSake, a division of AfriForum, filed the urgent application after it learnt that the metro was about to pay over the money.

The controversial multi-billion rand contract between the metro and Peu was cancelled in May last year, after the deal had been found to be irregular.

National government had warned Tshwane on several occasions not to enter into the contract, saying it was, among other reasons, too expensive.

The metro however, concluded the contract with Peu and smart electricity meters were rolled out in the city.

During the 2014/15 financial year, Peu was paid some R830 million despite only 12 900 smart meters had been installed – a per meter price of R64 341.08!

Source: Court halts payment for doomed smart meters | Rekord East