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India to replace existing electricity meters with Smart Prepaid Meters by 2025

India to replace existing electricity meters with Smart Prepaid Meters by 2025


  • GS 3 || Economy || Infrastructure || Power & Energy

Why in news?

The government has notified the timeline for replacing the existing meters with ‘smart prepaid’ meters having a facility to enable the ‘prepayment’ feature.

Present Context:

  • As per the Ministry of Power notification, all consumers (other than agricultural consumers) in areas with communication networks,will be supplied electricity with smart meters.
  • The replacement work will complete in two phases byDecember 2023 and March 2025.
  • The Power Ministry had advised all central ministries and departments to switch to prepaidsmart electricity meters.
  • The ministries have also been asked to issue all enabling orders in this regard.

What are smart meters?

  • Smart meters can communicate data to the discom.
  • Central Electricity Authority’s (CEA) technical specifications say that smart meters should have features such as Bidirectional communication, integrated load limiting switch, remote firmware upgrade, net metering, and prepaid, post-paid, and time of-day tariff features, over and above the measurementof electrical energy parameters.

Why smart meter needed?

  • Smart metering is required because it is projected to enhance discom revenues by considerably improving metering and billing efficiency.
  • Discoms’ revenue disparities have been widening for some time, and the epidemic has just widened them more. Additionally, their debts to electricity generators have accumulated to the tune of Rs. 70,000 crore.
  • As a result, the Centre proposes a major investment in smart meters. The anticipation of a significant increase in payment collection efficiency justifies a large-scale rollout.

Benefits of Smart Meters:

  • Operational Benefits: Through a web-based monitoring system, it incentivizes energy saving by detecting data-entry mistakes and billing efficiencies, as well as lowering the expenses of human meter reading. Smart meters that have been installed can also be switched to prepaid mode.
  • Customer Benefits: It improves customer satisfaction by improving complaint handling, system stability, dependability, and transparency.
  • The Time of Day (ToD) rate function on the new meters allows customers to shift their power use to off-peak hours, lowering their cost substantially.

Issues with Smart Meter:

  • Complex system:Smart Meter is a complex system of technologies that must be integrated with utility information technology systems, such as Customer Information Systems (CIS), Geographical Information Systems (GIS), Outage Management Systems (OMS), Mobile Workforce Management (MWM), Distribution Automation System (DAS), and so on.
  • Radiation Leakage: Unlike electronic meters, smart meters allow for ‘communication’ between the user and the meter, which increases the risk of radiation release.
  • High capital expenses: A full-scale deployment of smart meters necessitates the purchase of all hardware and software components, as well as network infrastructure and network management software, as well as installation and maintenance charges and information technology systems.
  • Interoperability standards, which provide consistent criteria for technology, deployment, and general operations, must be specified.

Program for smart metering:

Smart Meter National Programme (SMNP):

  • Energy Efficiency Services Limited (EESL): Smart meters are being deployed around the country as part of the Smart Meter National Program. Energy Efficiency Services Limited (EESL), a joint venture of PSUs under the Ministry of Power, is implementing the plan.
  • Energy mix with innovation: India is on a road to alter its energy mix with innovation, with power consumption set to grow by 79 percent in the next ten years. In addition to increasing energy output, the country must reduce aggregate technical and commercial (AT&C) losses to below 12% by 2022 and below 10% by 2027.
  • Advanced Metering Infrastructure: The smart grid, of which the construction of Advanced Metering Infrastructure is the first phase, is enabling India to meet this need. Through a web-based monitoring system, a new line of ‘smart meters’ can help India manage its power more efficiently by detecting data-entry mistakes and billing efficiencies, as well as reducing the expenses of human meter reading.
  • EESL’s Smart Meter National Programme (SMNP) is striving to replace 25 crore conventional meters with smart meters across India, thanks to its pioneering role in India’s energy saving journey.

What is the Advanced Metering Infrastructure (AMI)?

  • Advanced metering infrastructure refers to the whole infrastructure, including Smart Meters, two-way communication networks, control center equipment, and any applications that enable the collection and transfer of energy use data in near real-time.
  • AMI enables two-way contact with consumers and serves as the smart grid’s backbone.
  • Remote meter reading for error-free data, network fault discovery, load profile, energy audit, and partial load reduction in lieu of load shedding are some of the goals of AMI.
  • In Indian context:
    • Investing in AMI to modernize India’s grid system will alleviate a number of grid pressures caused by rising demand for electric, gas, and water resources. AMI will enhance three major aspects of India’s grid infrastructure in particular:
  1. System Reliability: AMI technology increases energy distribution and overall reliability by allowing electricity distributors to detect and respond to electric demand automatically, reducing power outages.
  2. Costs of Energy: Increased dependability and functionality, as well as fewer power outages and faster billing procedures, would significantly lower the expenses of providing services and maintaining the grid, thereby significantly lowering electricity rates.
  3. Power Theft: In India, power theft is a widespread problem. AMI systems that measure energy use will allow for near-real-time power monitoring, resulting in enhanced system transparency.


Government said that prepaid smart metering in all government departments would not only bring DISCOMs back on the path of financial sustainability and promote energy efficiency, but would also serve as a model for similar state department mechanisms to promote pre-payment of electricity.