Reasons for Commercial Losses

Upgrading the sub-transmission and distribution systems and bringing about technical improvements can only reduce technical losses. The large amount of commercial losses cannot, however, be reduced by strengthening of the network. The need of the hour is to implement a separate programme of action for reducing commercial losses. We summarise below the major reasons for commercial losses:

Direct Tapping by Non-customers

Unscrupulous consumers extract energy illegally by bypassing the energy meter or by connecting leads directly to the distribution lines. In certain areas, direct tapping of power by non-customers is widely prevalent

Direct Tapping by Non-customers

This kind of power theft takes place mainly in domestic and agricultural sectors. Geographical remoteness, mass basis for theft, poor law enforcement capability and inaction on the part of utility are helping this phenomenon. Direct theft is an insult and, thus, a challenge to the utility engineer. It speaks volumes about the inefficient functioning of the distribution utility. This should be tackled on a priority basis by the utility.

Pilferage and Theft of Energy by Existing Customers
In addition to the factors discussed above, theft of electrical energy by existing consumers is causing an increase in revenue losses. Since it is often not possible to find out culprit, the stolen energy cannot be measured and, therefore, cannot be charged to any one. Stolen energy is therefore, considered as a part of losses. Theft by the existing consumers through tampering of meters is a predominant cause of loss of revenue to the electrical utilities. Almost all categories of consumers are involved in power theft

Stealing of Electricity from DTR Secondary

However, emphasis can be given on inspecting high value services for more effective and immediate gains. There are umpteen methods for
tampering the meter. New methods are being constantly evolved. The thief is always ahead of the utility

Defective Metering, Billing and Collection

In addition to the external factors discussed above, commercial losses are also caused by some deficiencies in commercial functions of the utility viz metering, billing and collection. These losses are not due to any deliberate action of the customers. They are due to internal shortcomings of the utility and, hence, are that much easier to tackle. They thrive due to the fact that the erstwhile Boards did not function on commercial lines though they were supposed to do so. Some of these factors are given in Box .

Box : Factors that Affect Commercial Losses

• Inaccurate metering system installed on outgoing radial feeders and DTs (inaccurate meters can result in errors in loss assessment).

• Slow or defective meters at consumer premises.

• Errors in the CT/PT ratios (in case incorrect ratios are considered in billing).

• Errors in assessment of consumption by un-metered consumers (like agricultural supplies, where billing is based on a normative kWh/HP
rate which may not be truly representative of the consumption).

• Errors in computing provisional consumption for consumers with defective meters or for consumers whose meters have not been read.

• Pilferage of energy by “hooking” or by illegal connections.

• Meter tampering by

− wilful burning of meters;

− tampering the meter readings by mechanical jerks, placement of powerful magnets or disturbing the disc rotation with foreign matters;

− tampering the seals of meters;

bypassing the meter;

changing the sequence of terminal wiring;

planting external equipments;

device inside/outside meter or metering reversing reading, which is a common practice in many urban cities where skilled persons/employees reverse the readings recorded by the domestic meters.

• Wrong readings and Data frauds: In many utilities the meters readers in connivance with the consumers bring lower reading than the actual reading recorded the meter. This is of even more concern if the consumer belongs to the HT (LIP/SIP) category.

• Non payment by consumers, where utility does not have a method for timely disconnection.