For electric utilities and grid operators, minimizing losses that occur during power transmission and distribution is a key priority both operationally and economically. However, not all losses are created equal. There is an important distinction to be made between “technical losses” and “non-technical losses”.
Technical losses refer to the unavoidable dissipation of electric power that takes place as current flows through utility wires, transformers and other equipment to transport electricity over long distances. They are an inherent part of powering homes and businesses due to resistive heating of conductors. Technical losses typically range between 5 – 10 % depending on the infrastructure and voltage levels involved.
Non-technical losses, sometimes called commercial losses, on the other hand involve electricity that is lost due to improper metering, fraud, or theft of power through unauthorized connections. This may include meter tampering, bypassing meters, billing errors and other supply chain inefficiencies. Non-technical losses are generally preventable through measures like upgrading payment and metering systems, infrastructure monitoring, site inspections and enforcement against power theft.
Technical losses are coming from current flowing in electrical installations. They can not be avoided, but can be reduced by proper installation and maintenance practices. Technical losses can also be calculated based on system characteristics. The key contributors to technical losses include:
- Losses due to conductor resistance
As current passes through conducting materials like copper wires, it encounters electrical resistance which results in I2R heating losses.
- Losses due to induction of electromagnetic fields
Varying electromagnetic fields induced by current flow can lead to dielectric heating losses.
- Dielectric losses due to insulation material between the conductors
All insulating materials absorb some power in the form of heat.
- Losses due to harmonic distortion
Non-sinusoidal waveforms (harmonics) increase losses compared to pure sine waves.
- Losses due to poor earthing
Inadequate or faulty grounding/earthing systems increase stray currents and associated losses.
Non-technical losses, sometimes called commercial losses, on the other hand involve electricity that is lost due to improper metering, fraud, theft or other supply chain inefficiencies. They are more difficult to reduce compared to technical losses, as they involve human and process factors outside the control of pure engineering solutions.
The key contributors to non-technical losses include:
- Meter tampering
Unauthorized alteration of meters to under-report consumption.
- Hooking or bypassing the meter
Diverting power supply before or after meter to avoid billing.
- Wrong programmed instrument transformer ratios in the meter
Programming errors lead to inaccurate metering.
- Burden for instrument transformers too high
Components exceeding capacity tolerances reduce accuracy.
- Wrong meter readings
Inaccurate recording or transmission of meter data.
- Meter is faulty or out of accuracy class
Defective or non-calibrated meter equipment.
- Unpaid electricity bills
Electricity supplied but not billed or collected due to process lapses
Understanding the distinction between technical and non-technical losses is crucial for electric utilities and grid operators. While technical losses are inherent and can be minimized through infrastructure upgrades, addressing non-technical losses through targeted interventions offers a higher return on investment. By implementing preventive measures, such as upgrading payment and metering systems, and utilizing advanced solutions like our portable meter test equipment and smart meter AMI solutions, utilities can effectively curb losses, strengthen revenue streams, and ensure the efficient distribution of electricity.
If you have any inquiries about how our CLOU solutions can support your loss reduction activities, please don’t hesitate to reach out to us. We are here to assist you and provide further information on how our portable meter test equipment and smart meter AMI solutions can help optimize your operations.
Editor's note: This article was originally published in July 2019 and has been updated for comprehensiveness.