Page 24 - Energize November 2021

NEWS

Assisting metros optimise revenue from service charges

Successful case study records savings of hundreds of millions of rands for a leading metro

ervice charges from electricity, water and sanitation are the main source of revenue
for municipalities. When not managed properly, this can result in a downward spiral of
Sreduced income and impaired service delivery.
Leading consulting engineering and infrastructure advisory firm Zutari has successfully
assisted a major metropolitan municipality recover hundreds of millions of rands in
previously unpaid water and electricity bills over the past few years. It now aims to roll out
this Revenue from Service Charges Management (RSCM) solution to the other major metros
in South Africa, as well as municipalities struggling to manage their revenue from service
charges, reveals Leon Prinsloo, Associate, Asset Management.
Zutari has produced a case study entitled ‘Optimal Revenue From Service Charges’ to
illustrate the full benefits of its RSCM solution, which is based on a Water and Electricity
Meter Management Consultant (WMMC) model. Its key deliverables for the metro
were meter installation and repair management (work management), meter reading
management, credit control management, contractor management, materials management
and ad hoc services such as revenue recovery and enhancement.
The ultimate aim is to ensure a high as possible percentage of what is known as ‘readings
onto bill’ – that is, the number of consumers receiving a bill detailing actual consumption
and related charges, as opposed to being charged interims or estimates. Zutari assisted the Leon Prinsloo
applicable metro to achieve a ‘readings onto bill’ percentage of over 90%.
For the specific metro, a revenue recovery project for electricity meters was undertaken, not recording consumption being
involving investigating electricity consumption ‘gaps’, the reasons for these ‘gaps’, and then one example. The solution can either
producing a billing recovery report for billing to the consumer. The end result has been a be used in its entirety for maximum
significant and sustainable increase in electricity revenue recovery for the metro. impact, or in part. Revenue recovery
For the specific metro in question, a revenue enhancement project for water meters can be seen as an example of a part
was also undertaken, involving investigating who were the top water consumers, identifying solution,” concludes Prinsloo.
all feeds, whether metered or not, and then combining all of these feeds into a single
metered feed. This has resulted in a significant increase in billable water consumption and Major benefits of the Revenue from
subsequent revenue. Service Charges Management (RSCM)
“Proper management of processes from procurement right through to lifecycle maintenance solution from Zutari for municipalities
and end of useful life replacement plays an integral part of optimising revenue from service • Optimised revenue from service charges
charges,” highlights Prinsloo. The crux is that managing data of hundreds of thousands of meters through:
requires a data management system that can handle large volumes of data. - Improved percentage of readings
Here Zutari’s in-house developed SQL-based Data Management System was key to onto bill
achieving the successes outlined in the case study. The system makes use of the unique - Revenue recovery initiatives (potential
27-digit surveyor general land parcel code as the primary key to link any data to this land of high return on investment)
parcel or stand. The data ranges from account holder and meter information to the history of - Revenue enhancement initiatives
work done at the stand, history of meter readings and credit control activities that took place (potential of high return on
at the stand. This provides for a complete record of all data applicable to a specific stand. investment)
An immediate advantage is that reports can be provided in formats that can be tailored • Positive impact on non-revenue water
to a client’s specific needs. An important report from a municipality perspective, for management
example, is the annual Service Delivery and Budget Implementation Plan (SDBIP) report. • Positive impact on non-technical energy
Municipalities are audited on these reports, and Zutari successfully assisted the metro losses management
referenced in the case study in compiling reports conforming to audit requirements. • Data management to ensure data
In order to provide accurate reports and data integrity within the client’s systems, a integrity of assets
process of data verification also takes place. This ensures that meter information captured • Scalable solution
into the client’s system is accurate. Meter information typically consists of the meter
number, meter size, the dials of the meter, date of installation and the GPS coordinates of Contact Rashree Maharaj, Zutari,
the installation. Phone 012 427-2000,
“The RSCM model also positively impacts non-technical losses for electricity, as rashree.maharaj@zutari.com,
well as Non-Revenue Water (NRW) management with the replacement of faulty meters https://www.zutari.com

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