Many utilities simply tolerate power theft and accept it as part of their business losses. While it is difficult to easily and accurately detect non-technical losses, there is a growing demand from regulators and ratepayers to do more about it.
Significant losses worldwide
Ratepayers especially are fed up with the theft as they end up paying for illegally tapped power from the distribution system.
The problem is a global one. In the US, an estimated US$6 billion is stolen annually and Canadian utilities lose hundreds of millions of dollars to theft each year. Puerto Rico has announced losses of US$400 to US$600 million annually. Certain areas within India report that 25% - 55% of power is stolen and a number of Latin American countries are reporting significant losses.
This is obviously draining profits from the global electric industry which could be used to upgrade and maintain critical infrastructure instead. These losses are significant when one considers the obstacles that utilities face already. Utilities have to develop new business models to remain relevant in a highly competitive industry.
The integration of renewable energy, distributed generation and microgrids, customer churn, integration of silos within the company, ageing infrastructure, and climate change are only a few challenges that the utility of today faces. This all calls for money but most have a tight budget and are struggling to implement the necessary changes. Power theft does not make this situation any easier.
Another problem is that many utilities don’t want to admit that power is being stolen within their area. In addition, utilities have to be very careful about cutting power to suspected thieves until a formal conviction has been made.
These convictions call for a high level of proof which isn’t always easy to attain. Detection of theft has always been difficult to pinpoint and prove since the tools have been somewhat limited. However, this is about to change.
Detecting losses-a new way
There was hope that an Advanced Metering Infrastructure (AMI) would help to detect theft but while these new meters are smart, the thieves were proving to be even smarter. For instance, thieves commonly tap power lines in front of the smart meters. This circumnavigates the utility’s ability to identify the illegal consumption.
While Advanced Metering Infrastructure has its advantages, it also means that there are fewer field visits by utility staff to read meters. As a result, thieves become bolder in their attempts to steal power.
But, there is a new kid on the block and he means business- Distribution Transformer Monitoring (DTM). This is a pioneering technology which helps utilities to pinpoint power losses created by technical as well as non-technical losses. The system creates an energy consumption reconciliation point at the transformer.
When properly combined with other data already captured by utilities, losses can be found accurately and efficiently. In addition to this, it also helps to report associated occurrence patterns, durations, and monetary values. By drawing on this valuable data, the utility and law enforcement are able to collaborate and resolve power theft efficiently. Of course, technical losses can be discovered using this data too.
Utilities commonly track their losses as a percentage of power purchased versus power metered. Virtually every utility meters less than 100% of the power injected. While there are always going to be technical losses, the percentage is low at 1% where assets are in good condition or 3% where they are not.
Calculating return on investment
When utilities multiply their loss percentage by their cost of power, they generally find they are losing millions of dollars each year. If they multiply their documented losses by the retail value -- by what they could sell that power for -- the monetary value becomes even more significant.
When viewed in this way, Distribution Transformer Monitoring technology can often produce an accelerated return on investment (ROI). The greater the losses, the faster the payback. In some instances, payback is less than two years; occasionally even faster, explains Alan Snook, president of GRID20/20.
The deployment of Distribution Transformer Monitoring technology will see utilities buy less power. This could mean lower rates for the consumer.
Other than the detection of power losses, Distribution Transformer Monitoring technology also provides many benefits- preventive maintenance awareness, outage notification/restoration enhancements, improved Conservation Voltage Reduction (CVR) practices, targeted demand response, identification of under/over-sized transformers, recognition of electric vehicle charging station impacts, and distributed generation monitoring.
When coupled with SCADA and meter data, the technology offers the utility a valuable solution for increasing power losses.
Any technology that promises an accelerated return on investment is definitely worth investing in. Utilities have a golden opportunity here to be more transparent by communicating the prevention of losses to their customers. They will be in a position to show how the investment in the technology is saving the ratepayer significant amounts of money each year.
This will certainly result in a higher level of trust and a stronger utility-customer relationship will be developed. Because after all, the consumer, is central to a utility’s success today.