India Plans to Spend $21 Billion on Smart Power Meter Rollout
(Bloomberg) -- India’s nationwide roll-out of smart power meters, aimed at supporting ailing utilities and bolstering reliable electricity supply, will cost about 1.5 trillion rupees ($21 billion), according to a government estimate.
The prepaid meters are expected to help to improve billing and collection, which are the most basic problems facing the country’s ailing distribution companies, known as discoms. These utilities, mostly controlled by their state governments, lose money because of poor billing and theft of power, which often leads to them delaying payments to generators and depriving their customers of reliable supplies.
The price tag estimated for the smart meters includes hardware, installation and operations, such as the system integration and data analysis, according to Power Secretary Sanjiv Nandan Sahai.
The planned 250 million prepaid meters across the country will raise enough revenue to cover the costs and lead to some savings for state power distributors, Sahai said in an interview in New Delhi. The government will run an auction for the contract to install the meters, said Sahai, who called them a “game changer” for the sector.
The systems will provide discoms with real-time data on consumption of each consumer, helping them spot thefts and losses, as well as plan power purchases better, according to Sambitosh Mohapatra, partner for power and utilities at PricewaterhouseCoopers India.
“Smart meters have the potential to alter the landscape and operations of discoms across the metering, billing and collection cycle,” Mohapatra said. “They can drive energy efficiency, allow customers to manage consumption, help discoms plan their capital expenditure better and lead to their overall financial improvement, benefiting the whole sector value chain.”
The country has already installed 1 million smart meters across four states, the power ministry said in a statement Tuesday.
©2020 Bloomberg L.P.