Prepaid Electric Meters

Presented by: Arnab Biswas Dibyarup Bhattacharya Mehul Ganatra Pradip Mukherjee Soumi Maitra Sreejib Chakraborty Suman Saurav

Preface
Till now more than 40 countries have implemented prepaid meters. In UK it has been in use for well over 70 years with about 3.5 million consumers After its launch in South Africa in the year of 1992 it has succeeded hugely in the country followed by other countries like Madagascar, Argentina, New Zealand Prepaid meters come in the market with Smart Card facility which holds information regarding no. of units used or the equivalent money value that has been used In India it is also growing day by day as people are finding it more convenient and cost effective for use

Feasibility of the project

Hotels and Resorts : Hotels and resorts in hill stations can save electricity bill by installing prepaid meters and switching them off in off season Company use : Companies that provide staff accommodation and need to monitor the bill for usage and control the consumption of electricity NRI & landlords : NRIs who do not live in their own houses for years do not need to pay a rent for electricity if they install this meter. Landlords have to pay the total rent for electricity when there are no tenants in the house. So, they can save their electric bill at that time by not recharging when there are no tenants.

Rural areas : 55% of Indian rural people have access to electricity, so in bad times when they need to cut down the expenditure on electricity they can stop recharging prepaid meters but in case of post paid meters they will always have to pay rent.

Farmers : Farmers need to pay an arbitrary amount for renting an irrigation pump for fields which also includes the cost for electricity. They can save the extra cost by paying for the exact amount of money for electricity consumed if they have a prepaid meter.

Benefits :

Security deposit at the time of installation only No disconnection at night and on holidays A graphic interface will be provided to each customer along with the meter, whereby he can see the exact date and amount recharged, the amount spent and also the remaining balance. Easy to find out power theft as the whole system will be monitored by a local server and each consumer will have an unique id to recharge No time limit for use of electricity after recharge Save the electricity bill by not recharging whenever you want Extra bill will not come even if you have mistakenly kept your fans or fridge on when you are not home Urban people can recharge the meter by an online facility with a unique pin no.

Competitors

Post paid meters : The main competitor will always be post paid meters as they already have a big market presence for years Chinese players : Chinese manufacturers are selling prepaid electric meters at a cheap rate in the country which can be a huge threat for Indian companies Solar power : Solar power is the most popular renewable energy used in India. By installing solar power people do not need to pay for electricity , so it can be a huge threat as meters are not required in this case.

Porters Five force analysis

New local companies entering the market Chinese manufacturers

The company itself is manufacturing the prepaid meters so there are no threats from as such suppliers

High rivalry as Chinese players give cheap products

Electricity Boards will always opt for lower price tenders for the projects

Solar power Post paid meters

Market prospect after 5 years

Tourism industry : Tourism industry in India is growing at a rate of 22% each year which means more and more hotels are opening in tourist places. These hotels are a big target customer for prepaid meters.
Maharashtra State Electricity Distribution Company Limited (MSEDCL) has successfully installed prepaid electricity meters in Lonavla in 2011.

NRI & Working professionals : NRI and working personnel who rarely stay at home are a big market for prepaid meters.
After China, India has the largest no. of people working as NRIs in the world, estimated at 25 million. The BPO sector is growing at 23% currently.

Rural area : Rural people are big target customers for Prepaid electric meters as in bad times and during winters they can save the expenditure by using this.
The Eleventh five year plan (2007-12) has stated growth rate of 9-10% in the rural power sector.

Electricity board tie up : The electricity board provides the electricity. The company has to make a tie up with the electricity board to reach the consumers. As meters can only be provided with the electricity, the company need not do any extra promotional activities for selling the meters.

No monthly rent required : Prepaid electric meters will run only on the basis of recharge that we are making each time. So, consumer need not to pay any fixed rent each ,they only need to pay a security deposit at the time of installment. Energy efficient : Prepaid meters caters a energy efficient solution as wastage of energy is a common scenario in India. In case of post paid meters energy is wasted rampantly but in prepaid meters after a certain amount of usage when the balance becomes zero, electricity will be cut off.

References:

http://www.dnaindia.com/mumbai/report_prepaidpower-meters-in-pune-pimpri-chinchwad_1574106 http://en.wikipedia.org http://articles.timesofindia.indiatimes.com/2011-0302/mumbai/28646093_1_prepaid-meters-rechargenew-meters MSEDCL Website http://planningcommission.nic.in/plans/planrel/fivey r/11th/11_v3/11v3_ch10.pdf