TUMS Response to Moneyweb Enquiry – 8 February 2017

Thank you for affording us the courtesy of an opportunity to respond to the questions re. the damaging allegations that appear to have been made against TUMS. It is disappointing that prior to publication of the February 6tharticle titled Cost of Tshwane electricity losses up by 56%- which alleges a link between the City losses and the TUMS smart meters - we were not provided with a similar opportunity to input or respond.

While concerned aboutwhether our responses will againbe disregarded in favour of a more sensational viewpoint, we have endeavoured to provide feedback on the enquiry received in the hope of receiving fair and balanced coverage.

As part of our response to the recent queries, we would ask your indulgence in incorporating corrections of some of the inaccuracies and misleading commentary of the previous (above-mentioned) article.

CT/VT ratios

The physical CT and VT devices remain the sole responsibility of the CoT and do not fall within the ambit of our contract with the CoT. In accordance with the contracted provisions, the CoT is also responsible for providing the values of CT and VT ratios to TUMS, maintaining the integrity of this data and providing any ratio changes to TUMS.

One of the key benefits of the TUMS system is that the CT/VT ratios are not set inside the meter. Instead, the meter is configured to read parity (i.e. a setting of 1) from the CT and VT devices. This is the lowest possible setting within the meter and consequently cannot be altered to under read in the meter as suggested in the article.To specifically prevent tampering, as agreed with the CoT, the CT and VT ratios are set within the back-end system. The back-end system is located within a highly secure state-of-the-art data centre, and the application that manages the CT and VT ratios is restricted, password protected and auditable.

We can confirm that there has been no unauthorized amendments or changes to the CT and VT ratios on our system. TUMS is not aware of – and has had no communication from the City of Tshwane about - a variance in CT / VT ratios affecting 600 large power users.

Any statement or insinuation that the CT and VT ratio on a TUMS smart meter can be altered at the meteris absolutely incorrect, perpetuates misinformation and is a disingenuous deflection of the issues causing the losses.

The TUMS System

TUMS has successfully established and are currently operating a sophisticated prepaid smart metering system and providing services to CoT in accordance with its contractual requirements. The TUMS system is established, robust and fully operational, having vended in excess of R16.5 billion of electricity- resulting in significant cashflow benefits for the CoT for electricity purchased and collected through the TUMS system ahead of consumption.

Thesystem deployed in Tshwane contains key Siemens products which include the Siemens eMeter system (MDMS), Netinium Head End system (MVMS), Siemens EnergyIP (ERP), Siemens pre-paid platform (as used by Vodacom) and Siemens LPU and SPU meters and data concentrators.

The Siemens system is positioned highest in the Leaders Quadrant of Gartner’s research on Meter Data Management Products 2014 through 2016. EnergyIP by Siemens earned the top position because of its advanced technology, broad offerings and rich functionality. At the time, Siemens had 38 EnergyIP reference sites and at January 2013 Siemens had 14 projects in execution accounting for in excess of 50 million meter points.

The system specification and mode of operation was considered and approved by CoT at the time of installation.

The smart meters deployed are operating in prepaid mode whereby a customer has to pay in advance ahead of consumption of electricity. The smart meters are SABS approved and have been accredited by Eskom. The TUMS smart meters are by no means dumb and allow for inter alia 15 minute interval reads, remote disconnection, integration with a customer interface unit and have bi-directional communication capabilities. We attach the product catalogue of the meters installed for your information.

Notwithstanding the views that Moneyweb may have canvassed from “senior Tshwane representatives” the CoT still states in its most recent court papers that it wants to take over the current system from TUMS. We assume this would not be the case if the system was considered by them as non-compliant or underperforming.

Demand Charges

Demand charges are calculated for customers whose tariffs include demand charges (typically higher consuming customers) and are based on actual meter readings. The meters register the highest rate of electrical flow (or current) during a billing period. The customer is billed for the highest average 30 minute flow during the period as the demand charge. In line with industry practice the determination of the provisional demand charges on a prepaid basis is projected in advance based on historic usage patterns by the customer. At the end of the month, the demand charge is adjusted to reflect the calculated maximum demand charge for the month based on actual consumption over the month. This methodology was pre-approved by the City and is working well.

Early Detection

The TUMS meters and related TUMS smart metering infrastructure combines industry leading features to flag irregularities .The system has to date identified hundreds of cases of tampering of infrastructure and the CoT has been able to recover millions of rands as a result of tamper remediation. The CoT benefits from the tamper detection functionality built into the TUMS system, and without it the tampers would continue to go undetected and the CoT would continue to experience ongoing revenue losses. In addition, we apply operational analytics to identify potential irregularities and in collaboration with the CoT, address any concerns the CoT has and we will continue to do so.

It is also important to note that the TUMS contract is based on a percentage of revenue collected. TUMS is contractually aligned with the City to ensure revenue is maximised and consequently any loss of revenue to the City, due to tampering or otherwise, results in a loss of revenue to TUMS.TUMS rejects any view that any of our actions are a deliberate ploy to manipulate data to our own advantage.