Challenges

Irregular metering data emanates from municipalities undertaking “meter estimations” due to use of manual meter readers that in many times do not have access to the homes as there is either no one at home or there are ruthless dogs in the yard. It is also known that these meter readers are at times capture the data on the datasheet without visiting the residential homes or commercial consumers just to increase the number of datasheets per day as they are paid based on datasheet captured per day.

Municipalities also implement “meter estimations” based on the previous data captured for that particular residential household or commercial site.

Inaccurate meter reading data then results in incorrect billings being issued to home owners or commercial consumers and as such billing queries from end-consumers.

The South African municipalities are all struggling with non-payment of services (electricity included) by end-consumers. Non-payment by end-consumers resulted in municipalities being owed approximately R140billion by end of 2018 financial year end. This then resulted in municipalities owing ESKOM approximately R17 billion in the same year. The following picture captures the current status-quo:

Electricity is not the only service in arrears – water, sewage, property rate & taxes are also not paid by end-consumers

The cash-flow challenges that are facing municipalities is centred around their billing systems and processes. The cycle is such that the municipality provides the service (be it electrical supply, water or any other utility), then send the bill at the end of the month which reaches the consumer mid-month. The municipality will ideally give the end-consumer about a month to pay for the services rendered. As such the collection spans over 60 days as depicted below.

This is the case where the power supplied by ESKOM to municipalities is even lessen when it reaches the end consumers. This purely demonstrates the inefficiency in the municipal distribution system as demonstrated in the picture below.

It is common knowledge that municipal infrastructure is been poorly maintained over the years and this is documented in an audit report produced by the energy regulator of South Africa. In view of this, most of the equipment reached end of life and are operating at lower performances. This is also true with electricity and water meters. Less performing equipment eventually result in inadequate data recording.

There are cases where the end consumers, be it residential or commercial will attempt to by-pass or alter the metering system such that they end up paying less than their actual monthly billable amount. These include altering the CT/VT ratios on larger power consumers to a mere bypassing of a meter in a residential setting. Another tempering is putting all the major loads onto one phase in a three phase configuration.