Warning for South Africans with prepaid electricity meters

Eskom and South African municipalities have just a month left to update about 3.2 million more prepaid meters, or they will no longer be able to load electricity tokens.

All Standard Transfer Specifications (STS) prepaid meters worldwide will stop accepting new tokens sometime on 24 November 2024.

The issue is caused by a time-based security mechanism that will run out of range on that date.

The feature embeds a unique token identifier number with each issued electricity credit to prevent the re-use of tokens.

Fortunately, prepaid meter users can apply a simple update to their meter that will resolve the issue.

The update is performed by entering two codes issued to customers when they buy prepaid electricity from a legitimate vendor — including a store or banking app.

These codes update the meter’s key revision number (KRN), rolling it over to a new version. Therefore, the project has been called “KRN rollover”.

With just a month to go, roughly 3.19 million of the 11 million STS-compliant Eskom and municipal prepaid meters in South Africa still need the update.

That means up to 29% — or between a quarter and a third — of all prepaid customers could see their meters become dysfunctional in a month.

Despite Eskom and municipalities distributing electricity being aware of the 24 November 2024 deadline for over a decade, the largest chunk of meters have been updated in the past year.

The majority of the problem lies with Eskom’s meters.

According to the South African Local Government Association’s (Salga’s) online dashboard, the country’s municipalities had updated 90% of their 4.1 million meters by 21 October 2024, leaving 395,833 outstanding.

That means they will have to update at a rate of about 11,994 meters per day to avoid any municipal prepaid meters being unable to load tokens in a month’s time.

Eskom had only updated about 4.11 million of its 7 million prepaid meters, working out to less than 60% of its cohort.

It has around 2.80 million prepaid meters that remain to be updated.

The 382,000 meters remaining in Gauteng alone are just about 16,000 less than the municipal prepaid meters remaining across the country.

To avoid any of Eskom’s prepaid meters from failing to meet the deadline, they will have to be recoded at an astounding rate of 84,728 meters per day.

The screenshots below show the KRN rollover dashboards of Eskom and Salga as of 21 October 2024.

Eskom KRN rollover progress

Municipal KRN rollover progress

Eskom suffering severe electricity theft

Eskom’s meter update rate has slowed to a crawl in recent months.

The slow pace raises big questions about the outstanding meters’ customers, particularly given that Eskom had already pre-coded 6.6 million of its 7 million prepaid meters by mid-July 2024.

All those meters would have received their KRN rollover codes with their next electricity purchase.

Taking into account how Eskom’s incline block tariff (IBT) punishes bulk electricity buying, it is highly unlikely that the majority of these customers had enough electricity to last three months.

The most logical reason for the lag in updates is that the users of these meters are either buying illegal electricity tokens from so-called ghost vendors, or they have illegally bypassed their meters.

In either event, those customers’ meters will become useless unless they load them with legitimate tokens before 24 November 2024.

Assuming the customers had not moved since Eskom last installed their meters, they could soon be getting a knock on the door from the power utility’s inspectors.

Eskom is fining illegally connected customers R6,050 and disconnecting them until they pay up.

Given the high number of prepaid meters that have remain un-updated, the power utility is likely to have severely underestimated the impact of electricity theft on its network.

In its 2022/23 financial results, Eskom estimated that it had lost R5.6 billion to illegal connections, illegal vending, and meter tampering.

If 2.5 million of the customers with un-updated prepaid meters are stealing electricity, they would consume 27,000GWh if they used Eskom’s average consumption of 900kWh per month.

With half that monthly consumption, they would steal about 13,500GWh in a year, roughly in line with Eskom’s estimations for the previous financial year.

However, Eskom’s kWh cost in its electricity theft calculation for last year is much lower than its actual electricity tariffs.

It estimated that the R5.6 billion in theft came from 13,396GWh of consumption, working out to a per-kWh loss in revenue of just R0.42.

That is much lower than Eskom’s actual electricity tariffs.

We calculated that the electricity theft could be costing Eskom between R17.85 billion and R94.68 billion in revenue in the current financial year when using the Homepower 4 tariff.

That is the most common price plan used by Eskom Direct residential customers.

The table below provides a summary of different electricity theft loss scenarios based on the number of customers that could potentially be using electricity illegally and various monthly consumption figures.