Abstract
The high incidence of electricity theft, meter tampering, meter bypassing, reading errors, and defective and aged meters, among others, increases utility losses, especially non-technical losses (NTL). A utility in Ghana piloted a non-technical loss reduction program in 2019 to replace postpaid meters with anti-tamper, anti-fraud, and anti-theft smart prepaid meters. By using customer-level residential billing panel data from 2018 to 2019 obtained from the utility, we assess the effectiveness of this program using the difference-in-differences fixed-effect approach. On average, the results indicated that the reported amount of customers’ monthly electricity consumption increases by 13.2% when any tampered postpaid meter is replaced with a smart prepaid meter, indicating the NTLs by customers. We further employed quantile difference-in-differences regression and observed that reported energy consumption has increased for all households except those at the lower quantile (25th quantile). We conclude that smart prepaid metering could be a remedy to reduce NTLs for the electricity distribution sector in areas where electricity theft is rampant.
Highlights
Access to a reliable and adequate supply of electricity is central to the achievement of socioeconomic and environmental development in any country [1,2]
It is straightforward to interpret this as the recovered non-technical losses (NTL), as cheating is more difficult after smart meters are installed
This study further aims to understand the conditional quantiles of the recovered NTLs for different customer categories rather than only obtaining the average impact of smart metering
Summary
Access to a reliable and adequate supply of electricity is central to the achievement of socioeconomic and environmental development in any country [1,2]. The Government of Ghana (GoG) has shown considerable commitment to providing adequate electricity to its citizenry through the National Electrification Scheme (NES), Self-Help Electrification Project (SHEP), Ghana Energy Development and Access. Losses lead to electricity shortages and unreliable power supply that affect businesses, firms, agricultural enterprises, unemployment, health systems, transportation systems, and the economy [8,9,10]. Paper for the World Bank Group Energy Sector. Monitoring Performance of Electric Utilities: Indicators and Benchmarking in Sub-Saharan Africa; The World Bank: Washington, DC, USA, 2009. Paper for the World Bank Group Energy Sector Strategy-Reducing Technical and Non-Technical Losses in the Power Sector, 2009.
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