Companies

Kenya Power rolls out ultra-smart meters in Nairobi

meter

A Kenya Power worker reads power meters. Smart meters remove the need for the utility firm’s employees to physically visit customers. PHOTO | FILE

Utility firm Kenya Power will in January introduce smart meters for its customers in selected Nairobi estates and small businesses in the Central Business District (CBD) as it deepens the use of technology to improve efficiency in its operations.

The power distributor on Wednesday said that it had set aside Sh150 million to finance the two-year pilot project in which 5,000 customers, whose monthly power bills exceed Sh100,000, will be furnished with the smart meters.

A successful pilot phase will pave the way for the distribution of smart meters to 500,000 clients countrywide in an exercise that is expected to cost Sh15 billion.

Kenya Power, which has 2.9 million customers, has picked two suppliers for the pilot CBD and Runda plan and is in the process of selecting a third one to supply Kariobangi’s light industries.

“We are in the final stages of the procurement process and expect that the first smart meter will be installed sometime in January,” said Cleophas Ogutu, a Kenya Power assistant engineer, who is part of the team overseeing the smart meter project.

“We picked upper class residential areas like Runda and businesses in Kariobangi and the CBD to help us get a sense of the two customer segments based on consumption.”

READ: Kenya Power secures Sh17b loan for infrastructure upgrade

Smart meters allow for a two-way communication between customers and the utility provider’s server where data is sent mostly through general packet radio service (GPRS).

It enables Kenya Power to remotely read the meters, removing the need for the utility firm’s employees to physically visit customers.

Off-site monitoring will also enable Kenya Power to remotely disconnect meters with overdue bills while also receiving real time notifications in case of meter tampering.

The firm will also send customers promotional messages as well as alerts in the event of a planned shutdown in a particular area.

Customers will be able to track their consumption in real time, enabling them to have better management of usage if need be.

Smart meters come with interactive displays from which one can access historical consumption data and information that can be used settle disputes in case of over-billing.

Kenya Power’s main goal is to make savings from operation costs. The firm estimates that the Nairobi project alone will help it save close to Sh700 million over the next four years alone.

“Each of the three zones will cost us Sh50 million, but we expect that over the next four years this will translate into distribution efficiency that will save us close to a billion shillings,” the company said. “The total investment of Sh150 million is therefore justified.”

The introduction of the smart meters comes at a time when the utility firm’s unpaid bills (listed as electricity receivables in its accounts) have risen to Sh9.1 billion as of June 2013 compared to Sh8.02 billion the previous year.

Of this amount, ordinary customers owed Sh2.86 billion while large consumers (who are the target of the new project) were in arrears of approximately Sh4.67 billion.

Three years ago, the utility firm launched prepaid meters that allow customers to pay for electricity as they consume. It is also one way of curbing the problem of unpaid bills.

“The company is currently installing prepaid and automatic meters to minimise the risk of non-collection,” Kenya Power said in its latest annual report, adding that it had installed 335,018 prepaid meters by June last year.

The automatic meters are a rudimentary version of the smart meters, which are currently being used by industries and big businesses with huge power demands.

The meters allow for one-sided transmission of consumption data to the power firm’s server on a preset day every month. The more common post-paid meters see customers pay after consumption and bills were, until recently, always in paper form.

Smart meters are currently in use in other countries with the United Kingdom planning to launch them late next year. It targets to have them in every home by the end of 2020.

The Nairobi City Water and Sewerage Company (NCWSC) is also planning to install about 90,000 smart meters in the next five years to help cut fraud in its billing system and enable it to tap the revenue it needs to improve supply.

READ: Nairobi Water targets big consumers with smart meters

The water firm says its devices will initially be installed for the top 10,000 water users including beer maker Kenya Breweries Limited, the University of Nairobi, Kenyatta National Hospital and soft drinks maker Coca-Cola.

In the UK electricity smart meters plan, consumers will foot the cost of the gadget’s installation in a staggered fashion factored into their monthly bills. This has predictably not gone down well with citizens, leading to the delay of the plan that was set to kick off earlier.

Kenya Power says it will absorb the full cost of the installation in both the pilot project and the national rollout.

“We will foot the entire installation cost and the customer will just pay their electricity bill as usual once the meter is in place,” Mr Ogutu told the Business Daily in a telephone interview.