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Identification of Energy Theft and Tampered Meters Using a Central Observer Meter: A Mathematical Approach

C . J. Bandim, Member, IEEE, J. E. R. Alves Jr., Member, IEEE, A. V. Pinto Jr, Member, IEEE, F. C . Souza, M. R. B. Loureiro, C. A. Magalhges and F. Galvez-Durand
Abstrczct-This paper presents a new methodology to identify energy theft and tampered meters as well as meters that are not working properly. It is based on a central observer meter that is responsible for metering the overall energy of a group of consumers under investigation. Deterministic and statistic approaches are used to determine which consumers have problems in their premises. Also, pattern recognition is used to discover energy theft using bypass.

installation (for example, number of phases), the distribution transformer to which the consumer is connected, etc.

Index Terms-Losses in power distribution networks; fraud detection.


In Brazil, one of the most challenging problems that

distribution utilities are facing is energy losses [ l ] [2]. Losses of distribution utilities are defined as the net result of the difference between the generated andor purchased energy and the energy effectively billed. They can be arranged in two types: technical and commercial losses. Technical losses are related to non idealities of electric equipment: transformers, transmission lines and other equipment have, for instance, ohmic losses and even the meters are not lossless. In order to reduce technical losses, several actions ccin be carried out by the utility: replacing old equipment by more efficient equipment, designing and building more efficient distribution networks, etc. Commercial losses are the net difference between the energy effectively supplied by the distribution utility and the effectively billed energy of the consumers. Theft of energy and meters that dont work properly are one of the major causes of commercial losses. Also, problems in the billing system may cause commercial losses to the distribution utility. Checking the billing procedures of the utility can be the first step to reduce commercial losses. To do that, the consumer database must be always updated, reflecting any change verified in the field with the smallest time delay. This database is important not only for auditing the billing. It is crucial for discovering energy frauds, as it maintains key information such as the class of the consumers (residential, commercial, industrial, etc.), the address, technical aspects of the metering
C. J . Bandim, J. E. R. Alves Jr., A. V. Pinto Jr. and F. C. Souza are with CEPEL-Research Center of Electrical Energy. M. R. B. Loureiro and C. A. Magalhles are independent consultants. F. Galvez-Durand is with UFRI- Federal University of Rio de Janeiro.

Another way to reduce the utilitys commercial losses is to enhance the observability of the consumers. A possible action can be regularly visiting the consumers metering installations to check them in order to find out any problem. This should be done by specialized and well-trained teams. However, these visits are expensive if carried out for the whole set of consumers of the utility. Because of that, utilities usually adopt a statistical approach to select the consumers [3] to be inspected and, consequently, they dont find out the existing problems of all installations. One possible alternative, reported in the literature [4], is substituting the conventional electromechanical meters for electronic ones, with anti-tampering characteristics. Singhal, S . [SI discusses revenue protection features brought by electronic measurement. The drawback of these arrangements is that it is necessary to change from the conventional metering to the electronic metering in all the installations. Improving the observability can be done by installing observer meters outside the metering installations, normally out of the residence of the consumers. At fist, an observer meter is necessary for each consumer. In Brazil, the utility provides the meter to the consumer and therefore the arrangement of two meters is very expensive if each consumer has two meters: one inside and one outside his premises. In addition, the outdoor meter costs more than the indoor one, as it must withstand hard environmental conditions.

A possible approach to overcome commercial losses in this sense should be the centralized system depicted in [ 11. In this
scheme, there isnt any metering inside the consumers premises and, besides, all the meters of a particular neighborhood should be accommodated in the same case. The observability of metering would be improved, as the metering could be viewed by everyone. Besides, energy bypasses would be easily discovered. This arrangement also includes a central observer meter, installed next to the distribution transformer. By comparing the register of this observer meter with the sum of the registers of all meters connected to the transformer, any problem can be found out straightforwardly. Nevertheless, the difference between the observer meter and all the consumers meters is not enough to point out which consumer has problems in his installation at a first glance. This paper shows that looking deeply into the problem reveals

0-7803-81 10-6/03/$17.00 02003 IEEE


alternatives to indicate installations with problems just watching the central observer and the registers of all the consumers. The investigation of metering faults by analysis of the metering readings have already been reported in the literature [ 6 ] .Chambers, R.G. [6] shows a systematic procedure with the purpose of discovering discrepancies between main meters and another meter readings focused on large generators. On the other hand, in the present paper the main target is recognizing frauds or energy theft.

Fig. 1. Exemplification of the central observer meter installation

1 1 . OBJECTIVE The main objective of this paper is to propose a methodology that indicates problematic metering installations. The algorithms developed here associate the measurements of a group of consumers under investigation with a central observer meter, registering the total energy of that set of consumers.
This method is particularly inexpensive, as it uses a single observer meter for a large number of consumers. In addition, the inspections of the consumers' premises by specialized teams can be better focused as the technique showed here is capable of identifying metering installations that present very strong probability of presenting troubles. The number of inspections can be reduced. Therefore, this procedure is more effective and less costly than inspecting the whole set of consumers.

We will also admit that another watthour meter is installed in a point where it is possible to measure the total energy supplied to the N consumers mentioned above. This meter will be called central observer meter (In practical terms, that meter should be installed close to the secondary terminal of the distribution transformer). See Fig. 2.

Observer Meter

J J!..

Fig. 2. Block diagram of the metering system

m.DESCRIPTION OF THE PROBLEM As mentioned previously, our interest is to identify, in a secondary distribution network, one or more consumers where the energy measurement is not correct. This may occur due to the following reasons: either the meter is tampered, that is, it is operating out of its accuracy class, or the consumer is getting some energy that is not being measured (through a conductor that bypasses the meter).
To allow this identification in a cost-effective way, it will be necessary to install a unique watthour meter (central observer) close to the secondary terminals of the distribution transformer. The methodology will be applied to the group of meters of the consumers that are connected to this secondary distribution network. See Fig. 1. IV. REDUCED MODELING We will admit that there are N consumers in this group and that for each consumer there is a watthour meter that accuracy class is m. The accuracy class indicates that the error committed by the meter should be smaller than or equal to m times the energy actually consumed. For example, a watthour meter whose accuracy class is -2% should produce, as a result of the measurement of lOOWh, a value between 98Wh and 102Wh.

Thus, for a certain period of time, is possible to say that the energy registered by the central observer meter and the energy registered by each of the N meters should satisfy the following equation:

Where: E ~ T U = energy registered by the central observer meter (it supposes that the central observer measurement error is wellknown); ki = a constant relative to the accuracy class of the meter of the i-* consumer (if the accuracy class is 2%, for example, the value of ki must be between 0,98 and 1,02); Ei = energy registered by the meter of the i-* consumer; lli5N. Since (1) is valid for any period of time, if we get N values of energy (from each of the N meters and the central observer meter) during N periods of time, the next equations should be satisfied:

Thus, admitting that the constants ki (1 I i 5 N ) are unknown quantities (which are related to the accuracy classes of the meters), we have a set of N equations with N unknown


quantities. Notice that the values of h T a j (1 IjI N ) and of E,j (1 5 i,j IN ) are obtained from measurements.

If the N equations above are linearly independent, a unique solution will be found for each constant ki. The value
calculated for each ki indicates whether the corresponding meter is inside or outside from its accuracy class m, that is, ki should be belong to the range ( I -m) I ki I ( I +m), otherwise either the meter is tampered or there is a malfunction. In summary, the method consists of obtaining a set of N Linearly independent equations, solving it to get the N values of ki, and determining whether the meters are, or not, working properly. Notice that the introduced basic modeling does not include: a) Frauds that are e x t m d to the meter, usually accomplished through bypasses. b) The technical losses that always occur among the central observer meter and the meters of the consumers. These effects Will be considered in the expanded modeling presented in section VII. V. SOLUTION METHODS For solving the system of N equations presented previously, several methods can be used. We have studied linear methods involving matrix inversion and recursive statistical methods (least squares).
Fig. 3. Four hypothetical consumen load curves Consumer 2

Consumer 4

Fig. 4 demonstrates that the coefficients have been adequately calculated in a situation where there is no fraud. In addition, a situation in which the meter of consumer 1 reads 70% of the actually supplied energy has also been simulated. Fig. 5 shows the results. It should be observed that the coefficient of consumer 1 has changed to 1.43 (1.43=1/0.7).
Meter 1 measurement 1 measurement 2 4600 4950 Meter 2 3650 4200 Meter 3 3150 3600 3250 2950 Meter 4 Observer Meter


: i





A. Matrix Inversion
The equations system presented in section IV can be written in a matrix form:

f I


= [E]*[KI


he coefficients of the meters, normalized, show that there is no problems

Where: [ E ; ] = array of the central observer measurements [K] = array of the meter coefficients [Eq]= squared matrix (N x N) with N measurements (lines) and N meters (columns) The goal of the method is to obtain the array [K]. Assuming that the matrix [Eq] is non-singular, the array [K] can be obtained from:

Fig. 4. Results extract from a Excel worksheet. Normal situation.

Meter 1 Meter 2 3650 4200 3300 3250 Meter 3 3150 3600 3250 2950 Meter 4 ObWNer Meter

measurement 2 measurement 3 measurement 4

3220 3465 3535 2800




[K] = [EqI-'

* [ET]

As an example, simulations have been made with four

[i ]= E

0 006822007
: W ; ; i z ; : ,

.O 005992005 -0 000626972 -0 00275405


0 00071 8494 0 001Mi973 -0 00377025 0004580265 0003604566 001290t325 -0003611193 -0001122239 0002494109


hypothetical residential consumers that had their load curves simulated SO aS to attend to the following criteria: for each his load are not the same for different days, and each consumer has his load curves different from the consumers are others. The load curves of the four hvDothetica1 -* presented in Fig. 3.

k h e coefficients of the meters, normahzed, show that there are problems In meter 1

Fig, 5. Results extracted from an Excel worksheet, Tampering situation.

B. Least squares [91 Since the measurements can be interpreted as variables with a statistical error associated, the presented modeling can be statistically analyzed. The error is due to the finite resolution or to the accuracy class of the meters.


According to this method, the unknown values of a mathematical model should be calculated so that the sum of the squares of the differences between the measured values and the estimated values multiplied by constants that measure the degree of precision, should be minimum. Expression (3) shows the formulation of minimum least squares called regression model.

Where: The expression in boldface is the error between the estimated and the measured value of the central observer W(N) = a weight array P(N) = degree of precision of the measurement

y(t) = ql.el +

e. + ... + pw e,

qT = measurements I = identity matrix

Frequently, the matrix P is initialized with P(O)= k*I, where k is a high value constant and I is the identity matrix. For time-varying systems, it may be necessary to introduce a way to reduce the influence of old values. In this situation, it can be introduced a forgetting factor h as shown below:
v(~,N =) (112) x N t = l hN-1 . E2(t)


Where: y - observed variable; 0 - unknown parameters; cp - measurements; t - time period in which the measurements were done. Quantities cp and y are measured for several instants of time. If we do not know the exact parameters, they can be estimated, obtaining expression (4).


ye(t) = pI.&]+

+ ... + q,,.&,


The value of h is between 0 and 1. The lower the value of A, the larger is the weight of more recent measurements, as compared with older measurements. Recursive equations are: 0(t) = 0(t-1) + Q(t).[y(t) - cpT(t).e(t-l)] W(t) = P(t).cp(t) = P(t-l).cp(t)[h + cpT(t).P(t-l).cp(t)]-l P(t) = [ l-W(t).cpT (t)] .P(t-1) / h The application of the least squares algorithm in a set of 12 was studied and the results are shown in this section. Consumer 1 had his meter tampered, so that only the third part of the energy delivered to the consumer was effectively computed by the meter. So, his coefficient should change from 1 to 3. Figure 6 presents a simulation of the behavior of the coefficient of meter 1, as a function of the measurements. In measurement 6, we have introduced a modification in the meter. The algorithm theoretically needs 12 measures to adapt itself. So, we can observe that, in the 18 measurement, the coefficient value is 3, that is, the algorithm has identified the fraud.

Where: & = estimated parameters ye = value of the observed variable as a function of the estimated parameters The problem of the least squares is to determine the Parameters so that Ye(t) agrees as clOselY as possible with Y(t). It is possible to demonstrate that minimum error is obtained when:


Where: & = array of estimated parameters; Q = matrix composed by the measurements in several instants of time; Y = matrix composed by the observed variables y(t) in several instants of time. The squared matrix (QT.Q) should be non singular. At first, this method also needs a matrix inversion. The number of lines and columns of this matrix is the same as the number of observations. Thus, the higher is the number of observations, the higher is the computational effort. However, there is an alternative method, denominated Recursive Least Square Method, in which, to obtain new coefficients, it is enough to know the values of more up-to-date measurements. This means that Recursive Least Square Method needs less computational effort than the Matrix Inversion Method. The Recursive Least Square Method can be expressed by the following equation: @(N+1) = e(N)+ w(N)[yN+i q(N+1) e(N)] W(N) = P(N+l) cpT(N+l) W(N) = P(N) cpT(N+l)[lq(N+l)P(N) cpT(N+l)]- P(N+l)= I-W(N) ~p(N+l) 1 P(N)


Fig. 6. Identificationprocess results


C. Main Dificulties An intrinsic difficulty present in the methods described above is obtaining the N linearly independent equations. When we observe the consumption of the N consumers for T units of time, we will obtain an equation. If we do N-1 other observations, each one for T units of time, there is a great probability that the new obtained equations be linearly dependent. This is due to the fact that, during the observation period of T units of time, the consumers may keep their


consumption pattern approximately invariable, making the new generated equations very close to each other. To avoid this difficulty, the algorithm should identify the singularity of the matrix ((DT.@)in order to choose a convenient set of equations. Another difficulty of the method is in the finite resolution of the watthour meters generally used by the utility. Most of these meters are electromechanical with lkWh of resolution. In other words, quantities lower than lkWh will be truncated. This fact can cause evaluation mistakes, when the equations system is being solved. Thus, the methodology should consider the finite resolution of the meters.

consideration two factors: a) The technical losses that occur along the distribution network, among the central observer meter and the meters of the consumers. These technical losses are due, mainly, to the resistance of the conductors that connect the consumer to the distribution network. In order to get a more accurate model of the distribution system, it is necessary a realistic estimation of the technical losses. This can be done through the knowledge of the electrical characteristics of the distribution network. Simulations of the system should be done in order to get a table, as precise as possible, relating the amount of energy flowing through the distribution network and the corresponding losses. Then, the energy measured by the central observer meter should be corrected, in order to compensate for the losses. For example, supposing that for a given situation the amount of losses iS 5%, EToTKj should be multiplied by 0.95 to obtain the energy actually delivered to the consumers. b) Frauds that are external to accomplished through bypasses. the meter, usually

To exemplify this problem, we have simulated a hypothetical

case with 12 electromechanical meters (each one with resolution of lkWh ). In this example, at any time, all of the consumers have the same consumption except for a null measure. This null measure is needed to keep the squared matrix (aT.@) from being singular. The shape of the matrix is presented in Fig. 7.
O a a a a a a a a a a a a O a a a
a a a a a

a a O a a
a a a a a

a a a O a
a a a a a

a a a a O
a a a a a

a a a a a
O a a a a

a a a a a
a O a a a

a a a a a
a a O a a

a a a a a
a a a O a

a a a a a
a a a a O

a a a a a
a a a a a

a a a a a
a a a a a

The external fraud can be estimated adding a term to (1) originating (8) as shown following:

Fig. 7. A hypothetical consumption matrix

a a a a a a a a a O a a a a a a a a a a a O

EmTa = klE1 + k2E2 + ... + kiEi + ... + kNEN + EF~


Equation (8) will be called expanded model and to correctly identify kl, k2, ..., kNthe coefficients E F ~Em, , ..., Em must be discovered at first moment.
A possible solution for this problem is carries out intelligent processing of the measurements of the consumers meters and of the central observer.

The value of a (hypothetical measurement value) was swept in intervals of 50Wh around 25kWh, 50kWh and 1OOkWh. For example, with regard to lOOkWh, the value of awas swept from 99499 to 100499. We assumed ideal conditions, that is, accuracy class equal to zero for the meters and technical losses equal to zero, too. The obtained coefficients values should be unitary. However, due to the finite resolution of the meters, in kWh, the obtained values are different from 1. Table 1 shows the biggest differences. Notice that, for low consumption, the effect of the finite resolution of the meters becomes more critical.

One way to achieving that is by providing a historical database with the consumption values of each consumer and the corresponding consumption of the central observer meter. When the deviation between central observer and the sum of the consumers changes significantly and this alteration coincides with the alteration of the behavior of some specific consumer, this indicates that this consumer (or consumers) may be doing a fraud by energy deviation. For example, we will present a simulated case where the difference between the measurement of the central observer and the sum of the consumers changes, being increased of 200kWh, as shown in Fig. 8. It should be investigated which consumers changed their behaviors of consumption at that same instant. For example, in this case a certain consumer changed his behavior, as shown in Fig. 9.


Maximum Differences



VI. EXPANDED MODELING The modeling described in section IV does not take into


The main difficulties for solving the system are getting a set of linearly independent equations, the finite resolution of the meters, the non-zero resistance of the energy cables, and the bypass of the energy that is not accounted by the meters. The problem of energy deviation through bypassing the meter demands a more careful analysis, based on observation of the consumer behavior, and will be better investigated in future works.



6 8

10 12

Gama, S.Z., et alli - Uma Nova Abordagem Tecnoldgica de Combate h Perdas Comerciais - XV Seminfio Nacional de DistribuiGLo de Energia Elttrica - SEND1 2002, Brazil, 2002. Bandim, C.J., Pinto Junior, A.V., Alvarenga, L.M., Loureiro, M.R.B., Santos, J.C.R., Galvez-Durand, F., - Loss Evaluation in Distribution Systems - Congreso Internacional De Distribucih Eltctrica, Cidel Argentina 2002 Nilsson, H. , Random sampling of and a scheme for reporting of malfunctions in electricity meters in Sweden , Metering and Tariffs for Energy Supply, 1999. Ninth International Conference on (Conf. Publ. No. 462)), Aug 1999 ,Birmingham, UK Misra, R.B. Patra, S, Tamper detection using neuro-fuzzy logic [static energy meters] , Metering and Tariffs for Energy Supply, 1999. Ninth International Conference on (Conf. Publ. No. 462), Aug 1999 ,Birmingham, UK. Singhal, S. , The role of metering in revenue protection , Metering and Tariffs for Energy Supply, 1999. Ninth International Conference on (Conf. Publ. No. 462)), Aug 1999 ,Birmingham, UK Chambers, R.G., Early diagnosis of tariff metering faults by a systematic analysis of maidcheck metering discrepancies , Metering and Tariffs for Energy Supply, 1999. Ninth International Conference on (Conf. Publ. No. 462)), Aug 1999 ,Birmingham, UK. Bandim, C.J., Souza, F.C., Alvarenga, L.M., Pinto Junior, A.V., Luiz, F.C., Alves Junior, J.E.R., Galvez-Durand, F., Loureiro, M.R.B., Dantas, A.R.,- Centmlized Metering System In Buildings - Congreso Internacional De Distribucidn El6ctrica, Cidel Argentina 2002 Costa, R.S. ,Caldas, R.P., Alvarenga, L.M., Pinto Jr., A.V., Souza, F.C., Pimentel, J.C.G., Bandim, C.J. - A New Concept Of Electrical Energy Metering In Buildings - E R E , 1994. Astrom, K.J., Wittenmark, B., - Adaptative Control - Addison-Wesley 1989.

Fig. 8. Difference between the sum of all consumer meters and the observer meter.

.- .. .-.

. . . . . . . . . . . . . . . . . . . . . .






2 4

6 8

10 12

Fig. 9. Hypothetical consumer load curve with an alteration of behavior

The change of the consumption level is about 200kWh, that may correspond to the unknown term EFj . Thus, already knowing this term, we would do the following composition in order to obtain an equation with the shape like the reduced model one:

In this paper, a new approach for identification of frauds or adulterations in measurement systems in distribution networks has been presented. The methodology includes the utilization of a central observer meter installed close to the secondary terminals of the distribution transformer, the energy measurements of this meter, the energy measurements of the meters of the each consumer served by this secondary distribution network, and convenient mathematical methods. It has been demonstrated that it is possible to identify, in a large number of the cases, which consumer (or consumers) is (are) committing frauds. The methodology is based on an equations system where the unknown quantities are the accuracy classes (normalized) of the meters. The possible methods for the solution of the system can use statistic or deterministic approaches.

Cesar J. Bandim is a research engineer and a project manager of CEPEL Electric Power Research Center, in Rio de Janeiro, RJ, Brazil. Mr. Bandim holds an M.Sc. degree in electrical engineering. Jose Eduardo R. Alves Jr. is a research engineer and a project manager of CEPEL. Mr. Alves holds a D.Sc. degree in electrical engineering. Mr. Alves is also professor of UFF - Flumineme Federal University, in Niter& RJ, Brazil. Fabio C. de Souza is a research engineer and a project manager of CEPEL. Mr. Souza holds an M.Sc. degree in electrical engineering. Ary V. Pinto Jr. is the manager of CEPELs R&D Program of Distribution Systems and Energy-Efficient Use. Mr. Pinto holds an M.Sc. degree in electrical engineering. Mauro R. B. Loureiro. is an external consultant that works in cooperation with CEPEL. Mr. Loureiro holds a B.Sc. degree in electrical engineering. Christiane A. MagalhFies is an external consultant that works in cooperation with CEPEL. Ms. MagalhZes holds a B.Sc. degree in electrical engineering. Federico Galvez-Durand is professor of the UFRJ - Rio de Janeiro Federal University in Rio de Janeiro, RJ, Brazil. Mr. Durand holds a D.Sc. degree in electrical engineering.