South Africa

Prepaid electricity crisis could spell doom for municipalities – but little has been done

Millions of STS-compliant prepaid electricity meters in South Africa will stop vending electricity in November 2024, and the revenue that municipalities receive from the sale of electricity will drop to zero instantly – but little has been done to address the looming crisis.

MyBroadband reported that around 70 million STS-compliant prepaid electricity meters worldwide are set to stop working next year, and South Africa is home to about 10 million of these meters.

Eskom is responsible for 6.5 million, while municipalities are responsible for the remaining 3.5 million.

The problem stems from how the system used to generate prepaid electricity voucher codes and guard against fraud is designed.

Due to their design, prepaid electricity meters have a built-in expiry date. They rely on a timer that started counting on 1 January 1993 and will run out of digits sometime during November 2024, said MyBroadband.

This is because the tokens that users enter into their meters must be unique to prevent fraud – two users must not be able to enter the same token.

Web Search Engine

In addition, the meter designers had to ensure that users couldn’t enter the same token into the meter twice, so the designers used a time-based mechanism to solve these problems.

When a user buys an electricity voucher, a section of the 20-digit token corresponds to the minute it was purchased. This time-based sequence of numbers in the 20-digit token is known as the token identifier (TID).

According to MyBroadband, designers of the meters allocated two bytes of space for the time portion of the token. This grants 16,777,216 unique minutes that can be attached to a voucher – amounting to 31.92 years – which ends on 24 November 2024.

This means households either have to switch away from prepaid electricity or be left in the dark — unless local authorities step in.

Easy fix

To resolve this issue, the Standard Transfer Specification Association (STSA), responsible for standardising prepayment technology, created an update mechanism for the system.

The update would change the base date of the token ID from 1993 to 2014 — buying the meters 20 extra years of functionality. It also includes an update to the cryptography meters used to encrypt and decrypt tokens.

Using the 2014 base date and the same 16,777,216 minutes allowed by the standard takes us to 24 November 2045. All that is needed to update the meter is for two 20-digit numbers to be entered into the meter — known as key change tokens.

One of those numbers clears the TID stack memory of the meter so that the device has no recorded tokens and thus cannot identify a newly entered voucher as being ‘old’.

The other updates the technology used to decrypt the tokens to be more secure. Once the update tokens have been generated for an electricity meter, prepaid vendors will generate 2014 base date vouchers for that meter.

However, there is no way to update a meter remotely, as the key change tokens must be manually entered into the meter, and authorities have been dragging their feet.

Little action

There are ways to perform the update: a designated task team can visit every meter, generate the key change tokens and enter them into the device, or end-users can be given the key change to enter into their meters.

However, allowing end-users to do it themselves has a risk. Any error in entering the key change tokens will leave the meter non-functional when the update numbers are generated.

While the update process is not complicated, with the necessary customer support, there has been very little of this support, information regarding the update, and general action to address the issue.

While Eskom is responsible for 6.5 million meters, it has only rolled over 5,800 – or about 0.09% of its total. This is despite the group being told about the need for this project ten years ago, MyBroadband reported.

The group has now decided to follow the model where users enter key change tokens into the meters themselves. However, the utility has yet to announce this publicly or run a communication drive to inform people of the need for the update – and time is running out.

Municipalities (responsible for 3.5 million) have also made little progress. Only 43 municipalities out of the 167 licensed distribution zones have indicated that they have started with the project.

Some municipalities in South Africa have made excellent progress with the update and are unlikely to run into any trouble when the rollover happens.

Polokwane, for example, contracted Visual Revenue Management to perform the rollover, which is over 70% completed.

Some metros, such as Johannesburg and Tshwane, started the project to update their meters in January 2023, while Cape Town began as early as November 2021, and they expect to conclude the update project by the end of 2023.

The problem is that many authorities haven’t started their projects, and the scope and scale of the issue may be larger than is currently estimated.

Don Taylor, the inventor of the first integrated prepaid electricity meter, said the actual number of meters could deviate by about 10% up or down from that figure – meaning the problem’s size could be much more significant.

Consequences

Any meter not updated by the time the rollover event happens will not be able to vend electricity after that date, and the revenue that municipalities receive from the sale of electricity will drop to zero instantly.

Additionally, some experts believe the sudden malfunction of meters may lead some individuals to illegally bypass the meters to access electricity, further exacerbating the decline in municipal revenues.

The 2022/2023 medium-term revenue and expenditure framework indicates that energy sources accounted for R160 billion of the R277 billion total income expected from South Africa’s metros for the year.

If meters aren’t rolled over in time, TID project coordinator Riccardo Pucci warned municipalities could face a considerable electricity piracy problem.

“You are going to get record numbers of meter bypasses. That’s essentially what’s going to end up happening. If the revenue protection problem was an issue before, it’s going to skyrocket,” Pucci said.

Read: The backbone of South Africa needs an upgrade – and fast

Artmotion S.Africa

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button