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City Power Johannesburg’s Approach to Smart Technologies such as AMR/AMI21 May 2009
Presented by:
Silas Mzingeli Zimu
Managing Director
Presented at:
African Utility Week
Cape Town
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Vision
A World Class Electricity Distributor
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Values
RESOURCEFUL
RELIABLE
RESILIENT
RESPECTFUL
Always with INTEGRITY
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What business are we in?
We are in the business of buying electricity from a source and selling it to electricity customers, making a profi t from this
KelvinNational Electricity Regulator (NERSA)
Transmission DistributionGeneration
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Electricity Distribution Model CUSTOMER
NEEDSERVICEMEDIUM
TelephoneInternete-MailMailFax
Face to FaceMachine
TelephoneInternete-MailMailFax
Face to FaceMachine
Media
SERVICECHANNEL
CallCentre
Web Site
ProcessingCentre
Cust ExecService Rep
Agent
ATMAgent
RadioPress
SERVICECATEGORY
Account Query
Application
Claim
Complaint / Compliment
Emergency
Information
Meter Reading
Payment
Power Loss
Sales / Product Advice
Service Request
Misdirected Call
Courtesy CallCredit Control
Planned OutageMarketing
VALUE CHAIN /PROCESS
Develop & Market Products & Services
Acquire Customers
Manage Availability of Supply
Manage Revenue Cycle
Network Asset Creation
Other Processes eg Complaint Mgt
CUSTOMERSATISFACTION
SERVICEDELIVERY
Directly from the
Value Chain
eg Power Restored
Via a Service Channel
eg Query Resolved
Integrated Systems and Databases
SAP/eRespondTraining
Empowerment
Attitude
KPI’sDATA
MAINTENANCE
BUSINESSRULES &
CONTROLS
RACI
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WORLD CLASS ELECTRICITY DISTRIBUTOR
PEOPLEPEOPLE INFRASTRUCTUREINFRASTRUCTURE
SERVICESERVICE1. Prioritize social
transformation (public lighting/electrification)
2. Seek more revenue
3. Loss reduction
1. Management style
2. Improve climate
3. Right people in right places
4. Training in key areas
1. Replacement & upgrades
2. Expand network
3. Maintenance
4. Outsourcing
5. Demand-side management
6. Alternative energy sources
Strategic Priorities
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COJ WINTER PEAK
3400 MW
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Knowledge
Data
Intelligence
Information
City Power Technology focus
City Power’s technology enhancement focus:
To forge the relationship between technology and the data stored in the technology using
Information drivers to make intelligible decisions
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Finance Commercial
Services
Customer Services Operations Human Resources Strategy &
Transformation
Manage Business Performance
Manage Availability of Supply
Manage Customer Interface
Maintain Network
Manage Revenue Cycle
Business Intelligence (BI) to Value Chains Mapping
Corporate PerformanceManagement
Customer ServiceDashboard Operations Dashboard
Work ManagementDashboard
Financial Dashboard
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RSA NATIONAL TARGETS
� A final energy demand reduction of 12% by 2014.
� For the industry sector - 15%
� For the commercial and public sector 15%
� For residential sector 10%
� For the transport sector 9%
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4 Innovative Steps to Creativity and Success
� Drink from and in existing knowledge and utilise it
� Generate an infinite number of ideas, don’t kill ideas
� Apply practical thinking
� Present the solution and move on to the next challenge
Apply the above 4 steps in life and be progressively successful
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��Increase Supply CapacityIncrease Supply Capacity
��Provide a costProvide a cost --free DSM benefit free DSM benefit
��Provide extended options for effective DSMProvide extended options for effective DSM
��Manage Energy Quotas effectively & efficientlyManage Energy Quotas effectively & efficiently
��Unlock Carbon CreditsUnlock Carbon Credits
AAdvanced MMetering IIntelligenceIntegration of Revenue Intelligence TM
& “SMART” Metering
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“SMART” METERING
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What are Non-Technical Losses – NTL’s ?
Commercial AdministrativeReceivables
� Fraud may be:
� Energy theft (illegal connections to the network)
� Meter fraud or by-passes
� Meter errors
� Fraud may be implemented by the customer or by professionals (third-party service providers and others who manipulate meter connections to reduce actual consumption volumes)
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NTL’s :
Commercial
�High cost of managing aging accounts
�Default Customers – Delayed Payments and no payment
�Defaulter consumer (*) → some will delay, some will not pay
�Volume and aging of receivable accounts has HIGH CO$T IMPACT → consumer used energy but did not pay on time, which increase company’s financial expenses
AdministrativeReceivables
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NTL’s :
Commercial
� Internal process flaws and database inconsistencies (Average 20% of all
problems identified by Audits in SA)
�Human and system errors (*)
�Incorrect tariff (*)
�Internal fraud (*)
* Usually not accounted.
AdministrativeReceivables
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Non-Technical Loss
NTLs and supply challenges
NTL
detection
Revenue Increase
Energy Consumption Reduction
Time
Energy
Energy paid
Energy consumption
32%*
68%*
* Figures from recent studies in Brazil
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• NTLs decrease ���� double benefit� Significant energy consumption reduction
� Revenue increase
• Energy consumption reduction� Diminishes total supply
� Reduces the demand-peak
• Choice’s solution delivers revenue increase benefit with an outstanding return on investment (ROI over
400% in 1 year)• Our solution can also provide huge benefits in dema nd
management without additional investments� Cost-free DSM benefits
NTLs and supply challenges
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SMART Meters
Towards a sustainable future SMART meters are ideal for:
• Effective resource management
•Rationing
•Demand side management
• Revenue Management
•Remote meter reading
•Free Basic Services management
•Limitation of demand
•Detection of tampering and bypassing
•Electronic communication with the end user
•Time of use
• Ease of vending
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SMART Meters-Advantages
•Remote disconnect and re connect of services
•Immediate final readings for Move in Move out
•Immediate notification on leaks and theft
•Reliable meter reading avoids protracted legal matt ers
•Regular and consistent meter reading dates – Accurat e energy balance
•Improved service delivery resulting in improved pay ment levels
•Control un-accounted for power usage
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Strategic Benefits•Eradicate areas with no meters
•Improve the city’s cost recovery in respect of elec tricity services
•Identify and solve problems associated with technic al loss
•Enable bulk purchases based on consumption rather l oss or ‘over-compensation’
•Redirect cost savings (administrative, meter readin g etc) to improve customer relations management mec hanisms and maintenance/back functions for the prepaid meter sy stem
•Improve refunds and clearance certificates turn-aro und times
•Eradicate interim billing
•Improved customer satisfaction
•Reduce growth of debtors book
•Save natural resources
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Implementation Progress
� All LPU’s on AMR, 9,000
� Targeted areas due to high NTL’s, 36,861 ( fully AMR, 32,299 Alex n 4262 Midrand)
� High consumption residential areas, ( fully AMR),;
� 2783 Fleurhof, Maraisburg, Florida n Delaray
� 4727 Discovery, Florida Lake/park/north horison
� 1309 Roodepoort west
� 501 Roodepoort north
� 174 Aspen Hills
� 1800 Blairgowrie
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Other Initiatives
� R1.5bn funding offer under consideration to install AMI/AMR throughout the City of Johannesburg
� Solar Water Heaters owned by City Power, R3bn phase 1, another R4bn phase 2
� SWH surcharge or levy
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The World is at significant crossroads
SystemReliability
Increasingenvironmental
pressure
Advancingtechnology
Continuingrate
pressure
� Resource adequacy
� Fuel diversity
� Grid reliability
� System operability
Record high electric prices
Significant infrastructure
investmenton horizon
Regulatorand customer
frustration
Climate change policy
Renewable Portfolio Standards
Significant energy efficiency aspirations
Renewables
Storage
Grid communications (AMI/ BPL)
Customer networks
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Global warming
Energy price
New challenges
Global warming
Energy price
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No Choice For The World
�The Best Way To Generate Energy is To Save Energy
�1kW SAVED = 3kW Generated