How to avoid large fines when sub billing and on selling electricity

hexeiscoElectricity Meters for Trade

National Measurement Act and financial penalties for electricity meters (utility)

If you currently do or plan to on sell electricity this article will provide you with a starter check-list to avoid financial penalties, damage to your reputation and strained relationships with your tenants.  With significant financial penalties ranging from $6,800 to $34,000 per offence, compliance with the National Measurement Act’s strict requirements is highly recommended.  It is very important to note that you need to do more than simply use pattern approved and verified electricity meters to comply and avoid the penalties.  As you will see the starter check-list covers selection, design, installation, commissioning, maintenance and use/operation of private electricity meters and systems.

As with most laws, “I didn’t know” offers no defence in court.

Background

In general bulk buying electricity and on selling to tenants is an easy win win scenario as electricity can be purchased and on sold for a profit to tenants delivering both parties significantly lower electricity costs.  This win win scenario and rising electricity costs is driving the significant growth in the number of private electricity metering systems for on selling and sub billing electricity.

Today the price of electricity is a hot political topic and Australian governments have responded with many initiatives to address consumers’ price of electricity and confidence in the supply and sale of electricity.  Recent initiatives include the 1 January 2013 amendments to the National Trade Measurement Regulations to removed of exemption for electricity meters from the National Measurement Act and the National Energy Customer Framework (NECF) to reduce the cost of compliance, regulate consumer protection and increase competition in the electricity retail market.

The National Measurement Institute used reported cases of inaccurate and unreliable meter readings in private sub metering and billing systems to argue for the removal of the exemption for electricity meters.  This supports Hexeis’ experience and in Hexeis’ opinion the government’s decision was inevitable as the sub metering market boom has resulted in some companies looking to make a quick and easy “buck”.  Unfortunately and of particular concern are meter importers who lack the facilities and expertise to verify the often questionable published datasheets from the meter’s manufacturer.  Additionally we have companies who attempt to design and install automatic meter reading system without the training, knowledge and testing protocols required to ensure that the meter data is valid and verified from CT to Electrcity Bill.

Note: Hexeis’ policy is to only use reputable and “bankable” meter suppliers such as Schneider Electric and Landis + Gyr.  These companies typically have 3rd party certified quality systems for manufacturing, testing and sales to ensure reliability, accuracy.  They also have the motivation and means to fund a product recall if an issue with their product is found.

The National Measurement Act and electricity meters

As noted, the National Measurement Act impacts the design, selection, sale, installation, commissioning, operational use, maintenance, modification and repair of all electricity meters used for trade.  Compliance requires more than simply using NMI M 6-1 pattern approval electricity meters.     Monitoring and enforcement of compliance is also very active as demonstrated by the detection of and penalties charged against companies who failed to comply with the National Electricity Rules on meter testing requirements and inspections periods, in particular CT meter testing.  Enforcement of the National Measurement Act can be expected.

Extracts from Part IV Division 2 of the Act – Requirements for use of measuring instruments for trade

These extract from the Act show the impact of the Act on the design, selection, installation, commissioning, maintenance and use of electricity meters and whole of automatic meter reading systems.

18GA  Measuring instruments used for trade to be verified.  A person commits an offence if the person uses a measuring instrument for trade; and the measuring instrument is not verified.

Penalty:  100 penalty units ($17,000).

18GB  Installing unverified measuring instruments.  A person commits an offence if the person installs in or on any premises or vehicle a measuring instrument; and the measuring instrument is installed for use for trade; and the measuring instrument is not verified.

Penalty:  200 penalty units ($34,000).

18GC  Supplying unverified measuring instruments.  A person commits an offence if the person sells or otherwise supplies a measuring instrument; and the measuring instrument is sold or otherwise supplied for use for trade; and the measuring instrument is not verified.

Penalty:  200 penalty units ($34,000).

18GD  Inaccurate use of measuring instruments.  A person commits an offence if the person uses a measuring instrument for trade; and does so in such a way, or under such circumstances, that the measuring instrument gives an inaccurate measurement or gives other information (including a statement as to price) inaccurately.

Penalty:  200 penalty units ($34,000).

18GD  Inaccurate use of measuring instruments.  A person commits an offence if the person does, or fails to do, something in relation to a measuring instrument; and the person’s act or omission causes, or is likely to cause, the measuring instrument to give an inaccurate measurement or to give other information (including a statement as to price) inaccurately when used for trade.

Penalty:  200 penalty units ($34,000).

18GE  Using or supplying inaccurate measuring instruments.  A person commits an offence if the person uses a measuring instrument for trade; and the measuring instrument gives an inaccurate measurement or gives other information (including a statement as to price) inaccurately.

Penalty:  200 penalty units ($34,000).

18GE  Using or supplying inaccurate measuring instruments.   A person commits an offence if the person sells or otherwise supplies a measuring instrument for use for trade; and the measuring instrument gives an inaccurate measurement or gives other information (including a statement as to price) inaccurately.

Penalty:  200 penalty units ($34,000).

 18HD  Transactions based on measurement to be in prescribed units of measurement.  A person commits an offence if the person sells an article (whether packed in advance ready for sale or otherwise) or a utility for a price determined by reference to measurement of the article; and a unit of measurement is prescribed by the regulations for that article or utility, or articles or utilities of that class, for the purposes of this paragraph; and the price is not a price determined by reference to a measurement of the article or utility in that unit of measurement.

Penalty:  40 penalty units ($6,800).

 

Starter check-list for owners and/or users of electricity meters used for trade

  1. Do you have records of when each meter was installed?
  2. Have you updated your meter asset management plan to ensure that if a meter is replaced or added, it is NMI-6 pattern approved and verified?
  3. Do you have records of when each meter was tested, the test procedure, test equipment, test results and the person who executed the test?
  4. For CT meters, have they been checked and tested the earlier of 10 years or when last modified/repaired?
  5. Did the people who designed, installed, commissioned and tested each meter have the require training, knowledge, equipment and competence?
  6. If you are using an Automatic Meter Reading System (i.e. BMS, SCADA, EMS) do you have records of testing the point to point data mapping?  Do you have a formal change management and audit system?
  7. If you are counting pulse outputs, do you have records to show periodic audits of a manual meter read against the converted pulse value?
  8. Are the people who use the meters and/or automatic meter reading system properly trained and competent?

Starter check-list for sellers of electricity meters used for trade

  1. Have to explicitly noted if the electricity meter offered is suitable for trade or not?
  2. If the meter is to be used for trade, does it have a current NMI-6 certificate from the National Measurement Institute?
  3. Is every individual meter verified by an authorized utility meter verifier?

Starter check-list for installers of electricity meters used for trade

  1. Have to explicitly noted if the electricity meter installed is suitable for trade or not?
  2. If the meter is to be used for trade, does it have a current NMI-6 certificate from the National Measurement Institute and is it verified?
  3. Is the person installing the meter following the manufacturers and/or engineering instruction?  This includes clearances from conductors, orientation, CT selection, cable specification etc.
  4. For CT based meters, is the secondary wiring within the upper and lower burden limits of the CT?
  5. Have you used a suitably competent person and fit for purpose equipment to verify and validate the meter’s performance  as installed?
  6. For Automatic Meter Reading Systems, is the meter data flow from meter register to electricity bill report verified, validated and documented?

Starter check-list for maintainers of electricity meters used for trade

  1. If the meter is to be replaced and is used for trade, does the replacement have a current NMI-6 certificate from the National Measurement Institute and is it verified?
  2. Does your meter asset management plan record when meters where installed, last modified, tested?
  3. For Automatic Meter Reading systems, have changes to meters been completed in the software?  Do you have records of this?
  4. Are the installers competent in the maintenance of electricity meters with access to the required equipment and software?

Conclusion

The National Measurement Act impacts on not only the meter equipment purchased.  It impacts the design, installation, commissioning, operational use, maintenance, modification and repair of electricity meters and the whole systems they may be part of.  Hexeis can help as we offers specialist engineering services for private meter system and can assist you with the design, selection, installation, commissioning, use and maintenance of your meters.

National Measurement Act

This publication is not intended to be a comprehensive review of all developments, or to cover all aspects of those referred to. Readers should take professional advice before applying the information contained in this publication to specific issues.