ontinuous development of new technologies in communication, electronic transactions and IT systems offers ongoing opportunities to redefine consumer services and enhance the competitive positions of utility companies. Recent prepayment projects in four contrasting markets illustrate the flexibility and scope of Actaris’ revenue collection technologies and services, showing how business models will develop to meet the hallenges of an evolving marketplace where customer service and cost-to-serve are becoming increasingly important.
PREPAYMENT APPLICATIONS FOR DIFFERENT MARKETS
Asia: First prepayment solution for Singapore Today Singapore’s electricity supplies are generated mainly from natural gas, and distributed by Singapore Power, the city-state’s largest multi-energy utility serving over 1 million customers. In 2004, concern about the estimated 1% of households not paying utility bills on time prompted a government decision to implement a prepayment metering system to help them manage consumption and avoid having their electricity supplies cut off. Singapore Power subsidiary SP Services Ltd awarded Actaris a contract to supply ACE9000 KBD meters, vending and management systems. After a four-month system installation and training period, prepayment was launched in May 2005 to 3,000 SP Services customers, enabling them to pay off part of their debt while buying credit. Actaris is also
contracted to manage the vending infrastructure where customers can top up their smart keys, operated in 62 Singapore post offices and in SP customer service centres.
UK: Managed service solution for UK utilities
Prepayment metering has a long history in the United Kingdom, which has the largest prepayment market in the western hemisphere with more than 5 million electricity and gas prepayment meters installed. Two of the UK’s leading domestic gas and electricity suppliers decided to adopt a single prepayment meter technology to improve efficiency, reduce service provision costs and optimise customer service. In 2004 Actaris commenced supply of Talexus® prepayment technology and data management services. This was the UK’s first dual fuel prepayment system to be offered nationwide, replacing various previous metering systems in different parts of the UK.
A new dedicated managed service centre, bringing together systems development, operations, sales and marketing functions, has enabled the suppliers to offer improved services while targeting a broader customer base. Actaris’ service centre, operated at Felixstowe, UK, provides prepayment data management services for hundreds of thousands of smart key prepayment customers on a nationwide scale, offering technical support, data processing and enquiry management with a B2B call centre to manage enquiries between the utility and Actaris. The enhanced two-way functionality provided by the Talexus prepayment technology supports a high level of remote management of consumers’ meters, including tariff upgrades, fault diagnostics and social non-disconnection factors. Since its launch the managed service centre has rapidly grown its managed customer base. Today it supports in excess of 530,000 utility customers and is projected to reach over 1 million customer managed points by year-end.
Africa: Better revenue protection for Randfontein
Since the early 1990s, the number of prepayment meters has risen dramatically in the Republic of South Africa, where the installation base exceeded 5 million at the end of 2003. Serious nontechnical revenue losses, aggravated by infrastructure problems and insufficient control over prepaid vending points, led Randfontein Municipality in Gauteng, South Africa, to look for ways to improve revenue management. Actaris was awarded a contract to strengthen protection of prepayment revenue through more efficient management of vending points and meters. Use of the latest available technology enabled Actaris to increase revenue protection on all levels, significantly reducing fraud and electricity theft. The turnkey solution was based on implementation of the ACE Eclipse System to provide continuous traceability of all meters and transactions, with services including revenue protection, complete revenue management and responsibility for the day-to-day operation of the project. Over the first 15 months, consumer numbers remained constant, while revenue collected through the prepayment system increased on average by 50%. In addition to better revenue protection services, additional vending points were provided throughout the region to improve revenue collection and provide better service for consumers, whilst further discouraging electricity theft.
Eastern Europe: Prepayment gas meters for Kyzylorda, Kazakhstan.
Kazakhstan is one of the biggest countries of the former Soviet Union, covering 2,717,300 km2 and Kyzylorda is the ninth of its 14 regions to receive pipe-line gas. Through KazTransGaz, set up in 2001, the Kazakhstan government began constructing pipelines to Kyzylorda in the southwest, to deliver natural gas to local homes for heating purposes. To establish the residential network, KazTransGaz, needed a system for measuring gas consumption and collecting payment from end-users that allowed transparent data management, secured revenue for the utility, reduced waste and raised awareness of the value of resources. They chose Actaris’ TaleXus Vendor system– a prepayment solution using the Gallus 2002 meter and the Payflex Smart Card that offers a wide selection of flexible applications.
It provides two-way communication with the meter by automatically recording consumption data on the smart card when the customer brings it to the utility to be recharged with payment. This gives the utility access to reliable consumption data, and guarantees 100% payment security. Almost all 25,000 Gallus 2002 meters are now installed in end-user apartments and the system is fully operational. “The Actaris prepayment system eliminates the problem of non-payment and bad debt completely, and also avoids all the social implications and the cost of disconnection and reconnection” says Mr. Serik Shukeev, General Director of KazTransGaz Distribution Co. “It provides us with a secure method of revenue collection as a platform from which we can make the transition to a commercial organisation.”
Historically, secure revenue collection has been a strong incentive for utilities to invest in advanced metering systems. As the market advances, the need to offer better customer service (sophisticated tariffs, improved billing accuracy and reduced cost-to-serve to address a broader consumer base) will further drive investment. Effective implementation of these technologies will demand greater integration between meters, communications and systems and will emphasise bundling technology with service to meet specific customer goals. Actaris’ significant experience in successfully implementing prepayment systems and associated services is helping to expand the opportunities this growing market offers for advanced metering technology. To best support our customers in all areas of smart metering, Actaris recognises the need to offer tailored solutions, based on a clear understanding of customer needs, and a willingness to work with key partners.