Propsed Billing and Monitoring System for Mepco Project Defense

8/12/2019 Propsed Billing and Monitoring System for Mepco Project Defense

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PROPOSED BILLING ANDMONITORING SYSTEM FOR

MEPCO AND ITS FINANCIALEVALUATION.

Presented By :

Syed Hasan Bilal Gilani.

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Presentation Outline:

Results And Discussion.

Benefits. Financial evaluation.

Simple Payback Period.

Discounted Pay Back Period.

Net Present Value.

Conclusion And Recommendations.

Conclusion.

Recommendations.

References.

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Statement Of problem:

Companies are focusing too much efforts in decreasing the linelosses and increase %age Recovery.

In every meeting it is also a prime agenda.

But no adherence is being given toward1. the effective , cost reduction,

2. time saving and3. targeted utilization of workforce.

This project report results an approach

1. to a sophisticated ,2. Effortless,

3. Error less and

4. Effective recovery monitoring system to the company.

This would be the proposed automated electricity billing system.

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Overall Objectives:

To develop new system which makes the monitoring systemmore easy and convenient.

To develop the new system which reduces billing andpayments posting cycle.

To develop the new system which is financially viable andreduces the company cost.

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Specific Objectives:

Financially viable system which reduces the company cost.

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Scope And Limitation:

focusing on developing a mechanism for MEPCO billing

system by which the monitoring system is convenient and

viable than the prevailing system which is not precise andhas too much flaws.

Limitations:

1. financial crises of the MEPCO.

2. Lack Of Funds.

3. Lack Of Top Management Commitment

The company may get funds from the donor agencies like

USAID or World Bank or from the commercial banks.8

Li R i


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Literature Review:

Prepaid billing In Uganda.

The authors have elaborated the development of computerizedbilling for those

who pay for power are exorbitantly charged to cover the costs ofenergy lost .

Help in improving the recovery of bills.

Help reducing the work load on employees.

Provide billing according to accurate billing.9


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Literature Review:

EPBS is an information technology-based innovation that

mostly utilizes a smartcard.

It requires the customer to

make advance payment before electricity can be used.

Incase credit is exhausted then the supply is cut off by a relay

system.

Customer can recharge by vending the token.

Amount will be credited with the value of the electricity

purchased.10


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Literature Review:

Inter Net Billing in UK.

This research investigates the new technologies that are

making Internet billing more feasible,

Model is Focusing on

Reducing Cost.

Organizational structure

customer relationships.11


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Literature Review: It has five major steps.

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Literature Review:

Paper Less Billing In Pessynlvania.

Once customer enrolled, he will receive a confirmation email .

When his bill statement is ready, company will post it online and

send customer an email.

Enrollment is easy. Get started by signing into customer online

account.

Customer can switch back to receiving a paper bill at any time.14


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Paperless Billing In Pennsylvania:

Help the environment by reducing paper waste.

Receive an email notification linking you to your new billstatement.

Customer will have access to it immediately rather than having

to wait for it in the mail.

View customer last six months of bill statements online

Download customer bill statements for record keeping.

Enjoy the convenience.

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Literature Review:

Online Billing In India:

The Orissa government has introduced online paymentsystem for the payment of electricity bills from 1st January2010.

Other States like Andhra Pradesh and Karnataka haveintroduced such a system for electricity consumers in theurban areas.

West Bengal has introduced this system for the ruralconsumers in a restricted way.

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http://www.business-standard.com/search?type=news&q=electricity+billshttp://www.business-standard.com/search?type=news&q=electricity+billshttp://www.business-standard.com/search?type=news&q=electricity+billshttp://www.business-standard.com/search?type=news&q=electricity+bills


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Literature Review:

Previously it was difficult for the power distribution companies to

collect electricity bills from every nook and corner of the state.

Now this system will facilitate payment of electricity bill.

This system provide two main benefits.

Facilitate online payment of electricity bills. Having far reaching impact on the total energy

management.17


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Summary:

The above research indicates that utilities are using modern

and advanced means of billing and payment system to

reduce their cost, improve efficiency and improves customer

relationships.

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M h d l


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Methodology:Analysis Of Prevalent And Proposed System :

Prevalent system is a completely manual reading and

billing system.

Prone to be manipulation and bogus entries.

Started with the issuance of billing programme by theManager commercial of the company.

Whole area is divided into 23 batches . 19

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Each batch is divided into sub batches.

Reading is being done through meter readers.

There are one MIS head quarter and four sub branches whichdeals with the billing of 2 circles each.

Every batch has a scheduled date for completion of readingaccording to billing schedule but it is never be implemented.20

Methodology:


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Billing delayed due to manual reading as well as delayedprinting of meter reading list.

Bills when delivered is then paid in banks , Post offices and

Nadra franchise shops .

After payment Banks, Post offices send the scroll toRevenue office .

Revenue office then checked the payment from stubs andscroll and then send to computer center for posting.

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Methodology:


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Sumission ofReading List To

computer center 2days

Printing of Bills InComputer center 7

days.

Collection ofBill fromcomputer

center 1 day

Dispatching ofBills to

Assistantmanager

Operation Office

1 day

Submission ofReading List toRevenue office 2

days.

Reading To Billing Cycle In Prevalent System.

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Methodology:


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Drawbacks:

Billing delayed .

Resultantly late delivery of bills.

Late submission of bills to consumer. Some time one or two days beforedue date and some after due date.

Most of the consumer unable to pay the bills due to late delivery of bills.

Poor Recovery %age.

Unable to provide clear 10 days to consumers for payment.

Monitoring of recovery can not be possible.

Old system that can not be updated according to the current needs.24

Methodology:


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Proposed System: Billing Procedure

Hiring Of renowned national or international Software company for

That caters our todaysrequirement of billing and monitoring system

Through bidding system or whatever the requirement under government rules.

The selected company will be responsible for

Maintenance

And updating the system for the period of ten to fifteen years.

Reading will be done by hand held devices

Then this system is provided to

All Revenue office,

SDO office for monitoring and feeding of basic data and printing of bills.

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In New system the field office is being provided the facility of

new billing system.

There will be one server which will be located in the MIS

center in the head office .

All the field formations must be given access to this system

for better monitoring purpose.

Every officer/ official is provided unique identification code.

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Methodology:


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The duty can be performed on computer software and send

directly to next higher authority for approval.

No need of separate computer center and in this way we can

save significant amount every month in shape of. Salary.

TADA.

Payment Posting Procedure:

We may offer our own franchise and give its franchise rights to

private people as well as banks and post offices.27

Methodology:


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The franchiser may get the franchise after paying securityamount.

Security amount will be from Rs:0.1million to Rs:10 million.

Franchisers can receive payments of the bills equal to the

security amount on each day.

Nadra,is doing the same practice.

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Methodology:


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Our company is giving Rs:8 per bill for collection charges .

NADRA offered many franchises in the distribution company area.

Nadra is offering Rs:6 per bill as a collection charges of the bills

and remaining Rs:2 per bill is going to Nadraevery month.

By opening franchise , Mepco can also offer Rs:6 for collection

charges and can save Rs:2 per bill every month .

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Methodology:


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By doing so Mepco not only can save

Huge amount of money every month

Able to get the recovery position of the particular batch immediately

after the due date ends.

The proposed system will not only remove all these problem

but also bring

Ease and convenience

Reduce unnecessary workload from employees.

It will also provide

Better customer friendly image in the eyes of valued customers

Reducing unnecessary complaints.30


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Methods OfFinancial Evaluation:

Financial evaluation will be done on the basis of

Simple pay back period

Discounted pay back period.

Net Present Value.

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Results And Discussions:


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Results And Discussions: Reducing reading to billing time from 12 to 3 days.

Submission ofReading

Through handheld devices 1

day.

Printing of Bills InRevenue Officecenter 1 day.

Collection of Billand dispatch to

Customers 1day

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Reading to Billing Cycle In Proposed System



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Collection of bills and payment on the same day. Reducing thebill collection to payment posting cycle from 12 days to 1 day.

Collection OfBills same day

Posting Ofpaymentthrough

Franchised

shops in sameday.

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Billing to Cash Posting Cycle In Proposed System



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In this system there will be facility of feeding the daily payment ofbills which will be done by opening of franchise shops .

Reading will be done through Hand held devices. Previously itwill be done through the meter readers manually. This willprovide the following benefits.

Reduce labor cost.

No manipulation.

Quick updation.

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Financial Evaluation:

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No Of

employees

required In TheSystem

Average

salary

Per Person

Total

Salary

PerMonth

Total

salary

for 5years

Monhtly

TA

& DAAmount

No Of

Offices

Monthly

TA&DA

expense

Per

Total

TA& DA

cost for 5years

Amount

Per Bill

No Of Bills

Paid

each

Month in

mill

Monthly Bill

Collection

Charges inmillion

Bill

Collection

Charges For

5 Years in

million

1 2 3 4=2*3 5=4*60 6 7 8=6*7 9=8*60 10 11 12=10*11 13=12*60\ 14=5+9+13

Prevalent

System 100 0.03 3 180 0.07 30 2.1 126 8 3 24 1440 1746

New

System70 0.03 2.1 126 0 0 0 0 6 3 18 1080 1206

Total

Saving

-30 0 -0.9 -54 -0.07 -30 -2.1 -126 -2 0 -6 -360 -540

Total

Operation

Cost in

millions

Amount In Million Rupees.

Category

of

System

Saving In TA & DA Cost

Total Savings Involved In the New Computerized Billing System

Saving In Salary Saving In Bill CollectionCharges

Simple Payback Period:


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Simple Payback Period:

184.54 (Outflow)

(Inflows) 115.2 115.2 115.2 115.2 115.2

Simple Payback period= 184.54/115.2= one year and six

months

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Discounted Payback Period.

184.54 (Outflow)

(Inflows) 115.2 115.2 115.2 115.2 115.2

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Year Income InvestementIntrest

15%Total

1 2 3 4 5=2-3-4

0 184.54 0 184.54

1 115.2 184.54 27.681 97.021

2 115.2 97.021 14.55 -3.626

3 115.2

4 115.2

5 115.2

Hence discouted Payback

period is less than 2 years

Calculation For determining Discounted Pay Back Period


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Net Present Value.

184.52 (Outflow)

(Inflow)

115.2 115.2 115.2 115.2 115.2

NPV= -184.52+ A( P/A,I,N=5) Annuity=115.2 I=15%

NPV= -184.52+ 115.2 (2.991)

NPV= -184.52+ 343.965

NPV= 159.4640


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Analysis: From the figures in the above table, it indicates that simple

payback period and discounted payback period is less than 2

years. Its Net present value is also positive.

Any payback period less than 5 years is considered to be good for

business purpose.

This payback period of only less than 2 years and net presentvalue is also positive. It makes this project very lucrative and

MEPCO can easily adopt this system without any hesitation.

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Conclusion And Recommendation:


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Conclusion And Recommendation:Conclusion:

After implementing this model it would be expected to get

following benefits

Financially viable.

Reduces cost.

Improves Recovery position.

Provide effective monitoring.

Reduces extra labor and saving a huge amount of money

every month.

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Recommendations:

Due to facing financial problem so it is decided in the first stage to

use hand held devices which is low in cost.

But it is highly recommended to use AMR meters in the high tariff

consumers when the company financial health will be improved ,

and priority must be given which is as under.

Industrial consumers.

Tube wells consumers.

Commercial consumers above 5 kW. 43

References:
http://nacetem.academia.edu/AwoleyeMichael


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References: Awoleye Michael. Evaluat ion and Program Planning, Volume 3, Issue

3, 1980, Evaluating the impact of utility company billing plans on residentialenergy consumption.

Francis M. Mwaura 2012.Adopting electricity prepayment billing system to reducenon-technical energy losses in Uganda: Lesson from Rwanda.

Kenneth Train, Patrice Ignelzi, Robert Engle, Clive Granger, RamuRamanathan. Energy, Volume 9, Issues 1112, NovemberDecember1984, The billing cycle and weather variables in models of electricity sales.

Marilyn Chikaodili Amobi. Socio-Econom ic Planning Sciences, Volume 41,Issu e 4, December 2007, Deregulating the electricity industry in Nigeria: Lessonsfrom the British reform.

Maureen Milroy, Feng Li. Research ArticleInternational Journal ofInfo rmat ion Management, Volume 21, Issu e 2, Ap ril 2001,Internet billing: the

experience from four UK utility companies.

, Yu-Yi Chen, Jinn-Ke Jan, Chin-Ling Chen.Computer Networks, Volume 48,Issu e 4, 15 July 2005.A fair and secure mobile billing system. 44
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THANKYOU.

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Propsed Billing and Monitoring System for Mepco Project Defense

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