11 Prabhakar Tandon Head Business Development Secure Meters Limited Distribution Reform-A different Approach

22 Some Known Facts India has per capita consumption of 1015 units which is among the lowest levels in the world. Average business connection days in India is very high as compared to global standards. About 300 million citizens in India live without electricity. Business operation of most of the small scale industries suffer because of the electricity as a major constraint. Agricultural consumption is largely unmetered and charged estimated rates, losses in other segments are often included in agricultural consumption numbers. Power outage is a concern in most of the cities © Secure Meters Ltd

33 Reform Actions by Government in last 10years APDRP RAPDRP FRP Model State Electricity Distribution Reform Management Bill Proposed amendment in Electricity Act & Tariff Policy IPDS DDUGJY Smart Grid and Smart Metering program UDAY-Ujjawal Discom Assurance Yojana © Secure Meters Ltd

44 Issues Organizational Governance Customer dis-satisfaction Increased debts Unaccountable business processes Poor maintenance of distribution assets Timely implementation of large scale programs Inadequate purchase processes Lack of service culture High Operating Expenses © Secure Meters Ltd

55 Present focus Shift in focus Utilities Investments Regulation Government Customer Utility Regulation Government © Secure Meters Ltd

66 Customer Centric © Secure Meters Ltd

77 Results PeopleTechnologyProcess How to achieve? © Secure Meters Ltd

88. People Process Technology Utility replace metering prepay systems simple & IT supported processes simplify bill easy to understand QA process 24x7 call center updated & correct database electronic reading only energy accounting customer education public relation focus high value customers transparency service levels solid team multiple payment options © Secure Meters Ltd

99 Prime Focus Areas Achieve Customer Service Excellence Reduce Aggregate AT&C loss Improve Power Purchase Reduce Cost to Serve Precise Government and Regulatory intervention © Secure Meters Ltd

10 Achieve Customer Service Excellence Door step services for release of new connections. Urban Outages to be fixed within 30minutes of reporting. All Billing and Payment related queries to be handled by Contact center. Safety related compensation to be settled in one day. Participation of Private sector contractors Effective long term contracts with incentive and penalties on published SLAs. © Secure Meters Ltd

11 customer service engaging & building trust customer centric IT driven solutions customer education transparent service levels simplify processes customer contact centers multiple payment options Solutions (process) (technology) Improvement How? customer service culture effective processes (people) Happy end users

12 Reduce Aggregate AT&C Loss Deliver timely, accurate and verifiable bills to high value customers 100% High value customers have functioning metering systems Urban domestic consumers have pre-payment metering system with multiple vending options 100% Agricultural consumers have pre-payment metering system with subsidy disbursement regime Regular system asset maintenance Holding people accountable for losses Outsourcing of MBC © Secure Meters Ltd

13 reduce losses solid team, trained accountable staff reliable & accurate meters leverage experience management quality energy accounting credit meters prepayment meters Solutions (Process) (Technology) Improvement How? metering, billing, collection (People) DT metering Happy end users will guarantee financially strong Discoms adopt best practice © Secure Meters Ltd

14 Reduce Cost to Serve Development of strategic plan Reduction in expenses of maintenance and replacement of assets Improvement in procurement processes of discoms Reduction in opex through accountable IT enabled business processes Focus on timely delivery of services Buying practices should factor the life time cost of buying decision © Secure Meters Ltd

15 Government and Regulatory intervention Long tenure leaderships Independent functioning of Regulator Regulatory watch and control on the quality of assets procured by discom Regulatory initiative and monitoring to adopt SLA based business processes by discoms along with relevant consumer compensations Agricultural metering and subsidy transfer through DBT scheme © Secure Meters Ltd

16 The roadmap © Secure Meters Ltd

17 Case Studies Results PeopleTechnologyProcesses © Secure Meters Ltd

18 West Bengal, India Results PeopleTechnologyProcesses West Bengal WB achieved a swing of $300m USD per year in their balance sheets by investing in energy accounting and then holding staff accountable for results. West Bengal WB achieved a swing of $300m USD per year in their balance sheets by investing in energy accounting and then holding staff accountable for results. © Secure Meters Ltd

19 New Delhi, India Results PeopleTechnologyProcesses New Delhi No one in the world has reduced as much losses (from 53% down to 15%), or as fast as the three Delhi discoms. Underlying that success is a solid focus on processes & people. New Delhi No one in the world has reduced as much losses (from 53% down to 15%), or as fast as the three Delhi discoms. Underlying that success is a solid focus on processes & people. © Secure Meters Ltd

20 Results PeopleTechnologyProcesses Manipur With the Chief Minister and MD taking personal interest, Manipur changed its processes to adopt prepayment metering with spectacular success of revenue realization. Manipur With the Chief Minister and MD taking personal interest, Manipur changed its processes to adopt prepayment metering with spectacular success of revenue realization. Manipur, India © Secure Meters Ltd

21 Government and Regulatory intervention Metering customer and network helps determine the facts against which individuals can be held to account Reducing cost to serve will directly contributes to health of Discom. Outsourcing of MBC to reliable contractor may bring drastic improvement in revenue and processes. Asset based funding should be done with asset provider responsible for maintaining the asset for minimum 10 years Stringent SLAs with asset provider will help improving the quality of assets and services. Asset purchase should be done through Quality and Cost Based Selection Process © Secure Meters Ltd

22 Conclusion Metering customer and network helps determine the facts against which individuals can be held to account All meters should be read electronically Reducing cost to serve will directly contributes to health of Discom Outsourcing of MBC to reliable contractor may bring drastic improvement in revenue and processes Asset based funding should be done with asset provider responsible for maintaining the asset for minimum 10 years There is need for review of performance management System of Discom © Secure Meters Ltd

23 Thank you © Secure Meters Ltd