Frost & Sullivan has released a new analysis that shows South Africa’s electric metering market earned revenues of over $14.7 million in 2008, expecting an increase to $50.5 million by 2014. The report also found that the smart meter market in South Africa will be experiencing substantial growth in the next few years through the replacement and conversion of obsolete credit and prepaid meter technologies. The end users covered in this analysis are residential, commercial, and industrial.
“Smart meters will allow for the implementation of time-of-use tariffs and remote disconnection of household appliances through two-way communication capabilities with utilities,” explains Frost & Sullivan energy analyst Ross Bruton. “This is expected to assist in decreasing peak demand in the country, thereby mitigating the current strain on Eskom’s spare capacity.”
“Smart meters represent the future of electricity metering in South Africa,” says Bruton. “The Electricity Regulations Act of 2006 specifies that all end-users with a monthly usage of 1000 kWh or more need to be on smart metering systems by January 2012. Smart meter implementation in the country is expected to represent substantial revenue growth in the electricity meter market, as each smart meter unit is significantly more expensive than traditional credit and prepaid meters.”
Although this Act is currently under review, the final document is expected to have a similar requirement. Eskom and regional municipalities are therefore legally committed to commence with the introduction of smart meter systems over the next few years.
However, although smart meter rollouts are expected to be governed by government legislation, the electricity distributors – particularly municipalities – have raised concerns on the available funds to implement these initiatives due to the high equipment cost of smart meter units and supporting communication infrastructure that will be needed to operate the smart grid.
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