Pay-As-You-Go Sustainable Energy
Paying in advance of their energy consumption, many users hailed the new meters as efficient and secure, allowing them to avoid billing errors and operation costs. This gave the government the green light to experiment with smart, more developed digit-token meters, allowing users to monitor their consumption as power prices soar to historical highs.
Technician checking pre-paid meters in Egypt - Mohamed el-Hosary/Egypt Today
As part of recently implemented austerity measures, Egypt announced new cuts to electricity subsidies last year, raising prices by an average of 26% from July. Old-fashioned power theft became a thing of the past, as experts hail the prepayment meter system code as preventive to stealing electricity from homes. “Both pre-paid and smart meters have multiple advantages, including accuracy in calculating power consumption, so users do not have to worry about incorrect readings, as human error factors are eliminated,” The Ministry of Electricity’s Spokesperson Ayman Hamza tells Business Today Egypt. Hamza went on to list further merits, like avoiding the damage of electric circuits at home in case of sudden high voltage supply.
The Ministry of Electricity has pushed ahead with increases to electricity prices for all consumption brackets, slashing subsidies off for only the seventh and last bracket. The move has attracted criticism from human rights organizations, who pointed to household electricity expenditure raising the burden of energy costs on the Egyptian population. “By monitoring their digital meters, users are now more cautious of their consumption not exceeding 1,000 kilowatts, which corresponds with the unsubsidized seventh bracket,” added Hamza.
The new meters can be recharged with up to LE 10,000, and the credit remaining after each month’s consumption is automatically moved to the next month. Hamza further added that the pre-paid meters could also be connected with solar panels, calculating the consumption via net metering that credits solar energy system owners for the electricity they add to the grid. For example, if a user generated 8 kilowatts of solar energy and consumed 100 kilowatts, the meters will only credit them for 92 kilowatts.
Are prepayment meters right for you?
Egyptians have been using the old, outdated domestic meters for decades. This system requires ministerial employees to take the meter readings at every house. However, readings have been criticized for inaccuracy, triggering the ministry’s efforts to issue bills that reflect citizens’ real consumption.
Now spending almost twice their household expenditure on electricity, users who switched to the pre-payment system tell Business Today Egypt how they managed to control their consumption with the new meters.
Abdel Latif, 55, lives in the small village of Shama in the Monufia governorate, located north of Egypt in the Nile Delta, where he has been using the pre-paid meters for the past three years. “These meters are the best thing that has been done by the electricity ministry in decades, as we were fed up seeing many people stealing electricity,” he says. Manipulating electricity readings is one of the shortcomings of the old system, where some users utilized tricks to reduce their bills like placing a strong magnet, causing the meter to malfunction, run backwards and stop reading the power consumed, without a sign of tampering.
Smart meters in Egypt - Mahmoud Fakhry/Egypt Today
With household appliances that include a refrigerator, a telephone, a television, a washing machine, fans and light bulbs, Abdel Latif recharges his meter with LE 100 ($5.59) for two months of consumption during wintertime; the same value is only sufficient for less than one month during the summer. “We run the fans constantly in the hot weather, which eats up the kilowatts,” Abdel Latif explain. Shama is inhabited by around 14,000 people. Abdel Latif said that he heard that almost 1,000 pre-paid meters were installed in houses there, with the meter cost at around LE 950 ($53). Resembling the new prepayment system to mobile recharge cards, Abdel Latif lauds the ease of the new system, “I can read the meter, which is available in the Arabic language, and recharge it from nearby centers or Fawry [an e-payment device available at booths].”
In Giza, Sayed Gamal, 32, recently bought a deep freezer to add to his household appliances’ consumption per month, leading to the reduction of the recharging value. “I recharge the card with LE 100, which used to cover 450 kilowatts of monthly consumption levels before we installed the deep freezer, after which the value only covers 200 kilowatts,” Gamal adds. Like many Egyptians, Gamal suffers from the impact of the high electricity bills on his expenditure. “The new meter is suitable for me, I pay what I consume, and do not worry at the end of the month of having high bills that do not reflect my consumption,” he says, comparing the two systems.
A step towards digital economy transformation
Egypt has announced a strategy of moving to a digital economy and electronic commerce, offering all services electronically by 2019. The strategy includes investing in 4G services, building smart cities and modernizing the telecom infrastructure. It also works to automate vital sectors like the education and the comprehensive health insurance system, as well as the Government Fiscal Management Information System (GFMIS), with the aim of increasing dependency on electronic systems in payments.
Former Advisor of Electricity minister Maher Aziz considered the shift to pre-paid and smart meters as “a step in the path towards a comprehensive digitalization,” saying, “Digitalization controls the electricity system, excludes human error and overcomes the weak sides of the old electricity system.”
CAIRO - 20 January 2019: With a perishing energy crisis and hopes pinned on surplus production slated to make the country a major exporter, Egypt is announcing a makeover in power purchasing to guarantee better prices and quality after an unprecedented hike on subsidy cuts.
Avoiding the sudden cut of electricity due to late bill-paying, users get a red flashing light in their pre-paid meters when the credit goes down to LE 10, an indication to re-charge the meter. Expert Aziz, who is also a member of the London-based World Energy Council, explains that even if the credit zeroes, the meter continues running for a short grace period. With the listed advantages of the pre-payment system, ministry spokesperson Hamza said there is a remarkable turnout by citizens to shift to pre-paid meters, adding that the ministry provides an installment payment plan for users wishing to purchase new pay-as-you-go meters.