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The Impact of Smart Prepaid Metering on Non-Technical Losses in Ghana

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  • Gideon Otchere-Appiah

    (Engineering Services Department, Northern Electricity Distribution Company, P.O. Box TL 77 Tamale, Ghana
    Department of Development Policy, Graduate School for International Development and Cooperation, Division of Development Science, Hiroshima University, Higashihiroshima 739-8511, Japan)

  • Shingo Takahashi

    (Department of Development Policy, Graduate School for International Development and Cooperation, Division of Development Science, Hiroshima University, Higashihiroshima 739-8511, Japan)

  • Mavis Serwaa Yeboah

    (Department of Computer Science, Faculty of Applied Science and Technology, Sunyani Technical University, P.O. Box 206 Sunyani, Ghana)

  • Yuichiro Yoshida

    (Department of Development Policy, Graduate School for International Development and Cooperation, Division of Development Science, Hiroshima University, Higashihiroshima 739-8511, Japan
    Network for Education and Research on Peace and Sustainability (NERPS), Hiroshima University, Higashihiroshima 739-8511, Japan)

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.

Suggested Citation

  • Gideon Otchere-Appiah & Shingo Takahashi & Mavis Serwaa Yeboah & Yuichiro Yoshida, 2021. "The Impact of Smart Prepaid Metering on Non-Technical Losses in Ghana," Energies, MDPI, vol. 14(7), pages 1-16, March.
    • Handle: RePEc:gam:jeners:v:14:y:2021:i:7:p:1852-:d:524927
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    References listed on IDEAS

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    1. Lynne L. Kiesling & Leonardo Meeus & Michael G. Pollitt, 2021. "Special Issue “Innovation, Policy, and Regulation in Electricity Markets”," Energies, MDPI, vol. 14(19), pages 1-4, September.
    2. Beyene, Abebe D. & Jeuland, Marc & Sebsibie, Samuel & Hassen, Sied & Mekonnen, Alemu & Meles, Tensay H. & Pattanayak, Subhrendu K. & Klug, Thomas, 2022. "Pre-paid meters and household electricity use behaviors: Evidence from Addis Ababa, Ethiopia," Energy Policy, Elsevier, vol. 170(C).
    3. Klug, Thomas W. & Beyene, Abebe D. & Meles, Tensay H. & Toman, Michael A. & Hassen, Sied & Hou, Michael & Klooss, Benjamin & Mekonnen, Alemu & Jeuland, Marc, 2022. "A review of impacts of electricity tariff reform in Africa," Energy Policy, Elsevier, vol. 170(C).

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