15 things to know about prepaid meters

2013-03-13 00:00

• PREPAID meters are more expensive. At the proposed 2013/14 tariff, the per kWh charge on the prepaid meter is 52 cents more than on the credit meter (R1,27 vs R0,75).

• Residents are expected to pay the full cost of the conversion from credit to prepaid meters. The cost is R2 500. A deposit of R1 000 is also required.

• Prepaid meters will be used to recover debt on past service arrears. Depending on the ratio applied, it could mean that if you buy R100 of electricity — R60 will go to electricity and R40 to paying off service debt.

• Msunduzi does not provide free basic electricity to households on a prepaid meter.

• Msunduzi did not consult residents about the conversion to prepaid meters. This suggests a substantial breech of faith with citizens, which is not very democratic.

• Prepaid meters work on a system whereby the consumer pays upfront for the service. No money, no service. Residents on credit meters used to having 60 days to pay for electricity will now have to pay upfront before electricity is used. Credit meters allow more space and time to deal with income shocks. This includes household strategies to reallocate expenditures.

• Prepaid meters remove all procedural protections and citizen safeguards. You cannot negotiate with a prepaid meter. Prepaid meters automatically disconnect if the tokens run out. This can happen at any time, day or night, in an emergency, if you didn’t correctly calculate how long the beans will take to cook for supper or that your child forgot to iron his or her school clothes the day before.

• Prepaid meters require consumers to purchase tokens, which requires that they also pay transport and opportunity costs. Currently, the city has seven vending stations, only one of which is open 24/7. This raises questions around externalising the costs of prepaid meters to residents who will have to pay for the transport to get to the vending station. In Pietermaritzburg, transport costs are not insubstantial nor is public transport reliable at night.

• Prepaid meters designed around reduced amperage frequently trip. This means that how lights and appliances are used in the home will have to be very carefully calculated and may limit multitasking. In winter, this will be exacerbated as electricity for lights and cooking will have to compete with keeping homes and bodies warm.

• The company that will supply the prepaid meters stands to gain R73 million (44 000 x R1 670 = R73 480 000).

• Prepaid meters pave the way for privatisation. The system lends itself to be captured by a private company where profits will be secured for shareholders; not in the interests of affordable, reliable and sustainable electricity access for all the people. Profits will not be reinvested into the electricity system, they will not be used for municipal operations or maintenance or to cross-subsidise other services and users. • Prepaid meters may lead to future job losses in the public sector. The struggle against prepaid meters is at the forefront of the struggle against neoliberalism, and its imperative of privatisation.

• The electricity backlog in Msunduzi stands at 9,5% (approximately 12 300 households). Socioeconomic rights as per the Constitution are to be realised progressively. The municipality first has to address the backlog (connect those without service) before it amends any current access standard.

• Prepaid meters exacerbate stress in the home and increase the burden on women and caregivers.

• Prepaid electricity will turn citizens with legitimate claims on the state into customers. A customer can only be a customer if he or she has money. Our history and current socioeconomic challenges do not support this. We are not a pay-as-you-go society. Msunduzi’s motives for converting credit meters to prepaid meters is not about extending or enhancing access, but arresting debt. Prepaid meters are not an instrument of equity or development. Prepaid electricity does not address poverty; it is not in the interests of poor households. It is not in the interests of all the people in our city. It will increase conflict between us.

• Julie Smith is a researcher for Pietermaritzburg Agency For Community Social Action (Pacsa).

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