World first: Prepaid electricity through smart grids

By Paul Budde

What could possibly be a world first is an innovative new smart grid application that Horizon Power is about to introduce – providing very sophisticated prepaid electricity services to its customers.

The company operates in what must be one of the largest electricity distribution areas in the world. It covers all of Western Australia, except Perth and the South West.

Horizon Power’s customers range from people living in remote, isolated communities with less than 100 people, to residents and small businesses in busy regional towns and major businesses in the resource-rich Pilbara region.

Obviously there is not one large grid that covers the utility’s distribution area. Most of their customers are serviced through distributed energy systems.

This in itself is very interesting, as there is an important trend emerging globally, towards distributed energy rather than “big grid” operations.

Traditionally the region’s energy source has been predominantly based on diesel generators; however, it would not come as a surprise to hear that they have become one of the leaders in using renewable energy for these distributed energy sites – there is plenty of sunshine in Western Australia. Internationally the future of distributed energy will largely evolve around renewable energy. So Horizon Power is right in the middle of new energy and smart grid developments that are going to shape the future of this industry worldwide.

Providing energy services to Aboriginal communities is a sensitive issue. There are many social and cultural issues that need to be taken into account and the Western Australia government has put some strict guidelines in place in relation to the prepaid service that Horizon wants to introduce.
This requires the company to deploy smart grid technologies so as to be able to operate such a sophisticated service.

Under WA Government rules the prepaid service must provide:

• Restriction of the de-energising period (only between 9am and 2pm during business days). Guaranteed energy supply has to be provided outside that period whether the customer has paid or not

• The metre has to display remaining credit and, if applicable, the extent of the limited credit

• Conditional credit extension mechanisms associated with restrictive debt recovery processes; and

• Ability to change from prepayment to credit status, and vice versa, quickly and on request.

These are extremely tough rules and they are challenging for a commercial organisation to manage; yet the company is doing all it can to develop this innovation for its customers and is confident that it will be able to do so.

What certainly assists this operation is the fact the company’s vision already is to be the architect and developer of sustainable energy solutions for regional WA. It recognises demand for traditional energy services will likely drop by one-third over the next 20 years and its customers will expect new, innovative services and business models; and that smart grids are a critical enabler in that process.

Based on the innovative prepaid service, the company is already developing other value-added services that it will be able to offer over this new smart infrastructure will follow.

Paul Budde is a board member of the Global Smart Grid Federation and special advisor to the ITU/UNESCO Broadband Commission for Digital Development.