Non-Technical Electricity Losses

Abstract

Non-technical loss of electricity (comprising theft, fraud, non-payment and billing irregularities) is a significant issue, particularly in developing countries, and represents a large financial burden on utility companies, governments and society as a whole. This paper takes a wholistic and global view of the challenge and provides a broad perspective of the interrelated issues. Media reports and public perception of non-technical losses tend to focus on residential consumers, particularly those with limited financial resources, whereas review of more robust literature indicates that the largest proportion of non-technical losses is often due to industry, state-owned enterprises and relatively well-off residential consumers. Measures to reduce non-technical losses focusing on average residential consumers, such as pre-paid metering, therefore have limited effect on overall losses. Strengthening of legal and regulatory frameworks, particularly with regard to those larger users, and installing high security tamper-resistant metering systems for commercial consumers may have more effect. The reasons for non-technical losses, especially theft, are complex, but the customer–utility relationship is a key determinant. Improvement of this relationship through local participation in development of renewable energy schemes, such as rooftop solar photovoltaics, could bring benefit if challenges such as financing, design of the distribution system, utility company codes and standards and competence in post installation maintenance can be overcome.