On Thursday, South Africa’s state-owned power utility, Eskom, said that it is currently installing prepaid meters in Sandton, Midrand and Soweto as well as Kagiso, with the objective being to enhance revenue to support the company’s financial sustainability efforts.

Plans for Johannesburg’s large urban settlement, Soweto, which has an estimated 180,000 customers, of which 80% are connected to a conventional billed metering system, include converting all users to split prepaid meters within the next 5 years.

Split prepaid metering

The utility highlighted in a company statement that customers will reap additional benefits such as improved reliability, reduction of public safety incidents and better management of energy consumption.

The company added that the days of billing errors will be a thing of the past.

In 2013, Eskom embarked on a project of installing split prepaid meters in Soweto, which resulted in a ZAR33.63 million ($2 million) revenue improvement in Soweto. The improved revenue collection is owed to the installation of 40,000 split prepaid meters and having converted over 13,000 to prepaid mode.

The figure is cumulative from July 2014 up to 28 February 2016, Eskom noted in a statement.

Soweto electricity challenges

In May last year, the power company put light on the fact that Soweto residents were indebted to the utility by an estimated ZAR8 billion ($526 million).

[quote]Although open to negotiation at the time, Eskom proposed a unique offer – install prepaid meters and revise their electricity debt or have their power cut off.

Gauteng general manger of Eskom Bandile Jack, said at the time that the power company would consider erasing a portion of the outstanding debt if the customer agrees to go ahead with the prepaid meter deal.

To ease residents’ concern and provide clarity on the situation, Jack said that Eskom would implement an educational programme to educate communities on the benefits of installing a prepaid meter.

Jack said: “We will soon go back and engage communities and make them understand the benefits of us upgrading the network and putting in prepaid meters.”

He concluded: “Thereafter, we will go ahead, install prepaid meters and embark on our credit-management processes, and we will cut off those people who are not paying their bills.”