1. Neil Ballantyne Options for a prepayment framework for the City of Cape Town in RED 1

2. Aim of presentation: List existing systems in CT Metro Give overview of possible RED vending system components Examine option for each component Present favoured option of the City for RED system Stimulate discussion Electricity vending in REDs: Discussion of options

3. Six existing vending systems in CT Metro area [1]: Cape Town and South Peninsula areas: Syntell master system 380 000 meters 125 off-line vending outlets (municipally supported) 110 on-line vending outlets (managed by vending service provider) 1,1 million transactions vended per month R45m value of sales per month R350 000 arrears recovered per month

4. Six existing vending systems in CT Metro area [2]: Tygerberg area Syntell master system 56 000 meters 38 off-line line vending outlets (municipally supported) 43 on-line vending outlets (managed by vending service provider) 250 000 transactions vended per month R9,9m value of sales per month R33 000 arrears recovered per month

5. Six existing vending systems in CT Metro area [3]: Oostenberg / Helderberg areas Landis & Gyr master system 51 200 meters 35 on-line line vending outlets (municipally supported) 30 on-line vending outlets (managed by vending service provider) 128 000 transactions vended per month R6,8m value of sales per month R35 000 arrears recovered per month

6. Six existing vending systems in CT Metro area [4]: Blaauwberg area Actaris master system 13 000 meters 14 on-line vending outlets (managed by vending service provider) 130 000 transactions vended per month R2,2m value of sales per month R21 000 arrears recovered per month

7. Six existing vending systems in CT Metro area [5]: Eskom supplied area: Actaris master system 80 000 meters On-line vending outlets and database hosted external to Eskom by service provider PN Energy (Khayelitsha) Actaris master system 60 000 meters On-line vending outlets

8. Discussion of possible system elements for RED1: SMS SMS + Encrypt Modules Where should RED’s SMS be located? Centralised for country? Regionalised in each RED area? If regionalised Hosted outside RED? –ie. outsourced Run internally by RED staff? Discussion issues Auditing of transactions Control over revenue stream Recovery of arrears via vending system – link needed to billing system

9. Discussion of system elements: Billing system Require a link to REDs Billing system: To enable one view of all customers Billed and prepaid Source for customer and meter data Control of arrears recovery – billing system holds customer accounts – not SMS Vendor control accounts for daily banking of proceeds from sales Billing System

10. Discussion of system elements: Vending outlets Vending outlets must be: Conveniently postioned In safe locations Open after normal working hours Secured against theft Two forms of vending outlets Those managed by RED Those managed by vending service providers

11. Discussion of system elements: RED managed vending outlets Require a skeleton of RED managed vending outlets (CDUs) distributed throughout the area to ensure availability of purchase points for prepaid electricity customers at all times Vending contract is between RED and shop owners These vendors to have emergency off-line vending capabilities so if all else fails customer can still buy electricity – essential service RED CDU RED CDU RED CDU These vendors to have emergency off-line vending capabilities

12. Discussion of system elements: Vending service provider managed vending outlets Vending service providers appointed to manage networks of vending outlets: Chain stores / shops Internet Cell phone via SMS messages Interactive voice response on telephone Unattended terminals Contract is between vending service provider and RED Vending service provider has contract with each vendor No interaction between RED and individual vendors Question: How to select vending service providers? Vending Service Provider Networks

13. Discussion of system elements: Communication network Communication network links all element of system System is run on-line to SMS simplifies tariff management issue of free basic electricity This allows bank type terminals at vendors Must provide for redundancy in communication channels using a selection of: GRPS modems of cellular network provider X 25 Telkom Diginet lines Internet connection Swiftnet radio links Communications Cloud

14. Discussion of system elements: Disaster recovery Remotely located disaster recover site Linked to main SMS – regular replication of data Provides alternative for generation of encrypted transaction codes if comms to main SMS or main SMS itself fails Daily tape back-ups Emergency off-line facilities at CDUs ensure sales possible in case of catastrophic system failure – sales at default tariff, no arrears, no service charges. Disaster Recover SMS + Encrypt Modules

15. Discussion of system elements: Link to Bank Communication network links to banking institutions for Verification of account status prior to purchase Payment transaction for electricity purchased – credit or debit card EFT To Banks

16. Database licencing issues What database to use? Oracle? MS SQL? Open source – eg. MySQL? Need to consider: Licencing costs Licencing for connection of vending service providers Open source in Government’s chosen route – lower cost, good performance

17. Vending system for RED EFT To Banks SMS + Encrypt Modules RED CDU Communications Cloud Vending Service Provider Networks RED’s Systems Chain stores & Shops Internet Interactive Voice Response Unattended terminals Vending Service Provider Sales points Billing System All with off-line facilities DisasterRecover SMS+ Encrypt Modules Cell phones RED CDU RED CDU RED CDU

18. Finally…… Questions????? Thank you