Parliament Warns of Revenue Loss and Security Risks as Prepaid Meter Update Deadline Approaches

With the critical November 24 deadline for prepaid electricity meter recording fast approaching, the Portfolio Committee on Cooperative Governance and Traditional Affairs has highlighted significant concerns surrounding the process. The committee emphasizes that full compliance with the recording requirement is essential to prevent service disruptions, security risks, and revenue losses.

The Push for Full Compliance

Committee members are urging the Department of Cooperative Governance and Eskom to ensure that all municipalities and customers are prepared for the transition. Dr. Zweli Mkhize, Chairperson of the Committee, expressed concerns about the potential impact on communities if the recording process is not thoroughly implemented. “Our concern is how all this could affect communities if it were not properly executed,” he stated.

This recording process mandates that all prepaid meters be updated to the Key Revision Number (KRN) 2 to comply with the standards set by the Standard Transfer Specification Association (STSA). Without this update, prepaid meters will cease to function, rendering them unable to accept electricity tokens, which could lead to widespread service disruptions.

A Simplified DIY Recoding Process

To make the transition smoother, Eskom has introduced a Do-It-Yourself (DIY) recording solution for customers. Customers who purchase prepaid electricity tokens from authorized vendors receive two sets of 20-digit codes to enter into their meters, allowing them to complete the recording process independently. According to an Eskom spokesperson, approximately 97% of meters have already been pre-coded, facilitating an easy update for users.

However, around 300,000 meters still require recoding, which includes a significant number of meters that may have been tampered with or illegally installed.

Financial Risks: R8 Billion Revenue Loss on the Horizon

The financial implications of unrecorded meters are a key concern. Dr. Kevin Naidoo, Deputy Director-General for Policy, Governance, and Administration, reported to the committee that failing to recode meters could lead to an estimated R8 billion in lost revenue due to non-vending and tampered meters. “That’s a huge amount, and we hope that something is going to be done to address that,” Dr. Mkhize commented.

Security Concerns in High-Risk Areas

Beyond revenue and operational risks, the committee also expressed concerns about the physical safety of technicians who work in “no-go” areas—regions where heightened security risks make it challenging for municipalities to implement necessary upgrades. In response, Mkhize recommended that municipalities collaborate closely with law enforcement to ensure technicians’ safety in these areas.

Ensuring Fair and Inclusive Implementation

One of the committee’s core priorities is ensuring that the recording process is implemented fairly and does not disadvantage any community members. The committee has requested a follow-up report from the Department of Cooperative Governance as the deadline draws near. “We note the progress that has been made, but we remain concerned about the deadline and want the department to come back around the deadline with an update report that tells us where things stand,” added Dr. Mkhize.

This proactive stance aims to ensure that all municipalities and customers are prepared for the transition, thereby avoiding potential revenue losses, security issues, and service disruptions across South Africa.

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