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Economy
Mahesh

30/03/24 10:52 AM IST

Smart meter electricity programme

In News
  • The move by Kerala late last year to opt out of the Centre's scheme comes at a time when this growing frenzy across states to push the smart metering of electricity connections is almost entirely predicated on the assumption that this technology will solve the problems besetting the country's electricity distribution sector.
Smart meter programme
  • Smart meters are part of the overall Advanced Metering Infrastructure solution (AMI) that measures and records consumers’ electricity usage at different times of the day and sends this information to the energy supplier through GPRS technology.
  • This can immediately control the Aggregate Technical and Commercial (AT&C) losses, due to power pilferage, bypassing meters, defective meters, or errors in meter reading.
  • Every kilowatt of power drawn from the grid is accounted for – and billed, thereby reviving revenues of the distributing companies (discoms).
  • The programme is expected to better billing efficiency by 75 to 100% while increasing the revenues of the utility companies to Rs. 1,38,100 crore.
  • EESL recovers the cost of these meters through the monetisation of energy savings, resulting from enhanced billing accuracy, avoided meter reading costs and other efficiencies.
Energy Efficiency Services Limited
  • Energy Efficiency Services Limited (EESL) is a joint venture of four national Public-Sector Undertakings – NTPC Limited, Power Finance Corporation Limited, Rural Electrification Corporation Limited and POWERGRID Corporation of India Limited, under the Ministry of Power.
  • It was founded in the year 2009 by the Government of India.
  • As South Asia's first and foremost energy efficiency leader, EESL leads the market-related activities of the National Mission for Enhanced Energy Efficiency (NMEEE), one of the eight national missions under the Prime Minister’s National Action Plan on Climate Change.
Issues with scheme
  • Globally, wherever smart meters have been installed by power distribution utilities, the aim has been to improve the effectiveness of the Time of Day (ToD) pricing of electricity, for which smart meters are essential.
  • ToD pricing essentially refers to differential electricity pricing at the consumer end across peak and non-peak hours.
  • In contrast, in India, smart metering is being driven primarily by the desire to lower distribution losses and accordingly the smart meters incorporate remote disconnection features.
  • But there are question marks over the willingness or ability of most state-owned discoms to disconnect errant connections.
  • The second issue is the recovery of the costs. The meters, according to a person directly involved in the implementation of the scheme at the state level, have three cost components – the fixed cost comprising the cost of the meter, installations, including the meter reading software, and the recurring billing cost.
  • The meters are to be procured by the discoms on a hybrid totex model, where a part of the fixed cost is paid upfront and the rest is paid out along with the monthly billing.
  • It is unclear how viable the cost recovery of these new meters would happen given the precarious financial position of most public monopoly distribution companies.
  • Analysts say given the challenges, a more appropriate strategy would have been to limit smart metering to higher-value consumers, which would make cost recovery amortisation more feasible.
Source- Indian Express

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