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The Lightning Thieves

The Cost of Electricity Theft is no Myth

Massive steel towers  and electrical cables channel electricity from Glen Canyon Dam into the power grid as part of the Colorado River Storage Project, which produces hydroelectric power used in Colorado and other Western states. In 2011 the project generated more than a billion dollars in power sales, but losses due to electricity theft could be as high as $30 million per year.

Massive steel towers and electrical cables channel electricity from Glen Canyon Dam into the power grid as part of the Colorado River Storage Project, which produces hydroelectric power used in Colorado and other Western states. In 2011 the project generated more than a billion dollars in power sales, but losses due to electricity theft could be as high as $30 million per year.

Eric Isaacson, spokesperson for Colorado Springs Utilities, says most instances of electricity theft or “diversion” are residential. “Customers are unable to pay for the restoration of service and plug the meter back in themselves, which can be dangerous.” He says commercial electricity diversions occur for similar reasons but on a smaller scale.

Investigators around the country agree, including Tampa Electric’s John Hammerberg: “We’re finding more and more people are … stealing electricity because of the poor economy.” American Electric Power, a company that serves Rust Belt states hit hard by layoffs, reported a 27-percent jump in electricity theft compared to the same period a year ago.

Besides the power companies’ costs from lost revenue, tampering with electrical equipment creates inherent, life-threatening dangers, including death by electrocution and fire. And these risks threaten not only the perpetrator, but also nearby residents, utility workers and first responders.

Nevertheless, power thieves employ a wide array of tactics in this mushrooming international crime trend. One of the most dangerous methods involves bypassing the meter by running wires directly from utility lines into a circuit-breaker panel. Patrick Hogan with British Columbia’s BC Hydro reported on one of the more creative cases of this type. The thieves actually hollowed out a utility pole so that, when they tapped into the high-voltage power line, they could run their cables through the pole and underground to avoid detection.

Other methods include attaching cables to either side of the meter, pulling a meter from a vacant building to replace one removed by the power company and tampering with meters to lower the usage readings. As with any type of theft, the losses incurred by the companies get passed along to consumers, who end up paying more for the electricity they use. But identifying and confirming theft has always been a time-consuming, inefficient and expensive manual process. As Susan Neel with Houston’s CenterPoint Energy observes, “You never know exactly how big the problem is since our product is not in inventory.”

Many industry officials believe the answer lies in new “smart grid” technology like smart meters, and data from Springs Utilities would seem to confirm that belief. Isaacson reports that the utility has upgraded to automated meters that “allow us to see immediately any consumption on a meter.” Therefore, “the amount of electricity stolen from Springs Utilities each year is minimal and an extremely small percentage (almost immeasurable) of what is generated each year. The kilowatt hours and dollar value are so small that we do not track these figures.”

Isaacson confirms that smart meters increase Springs Utilities’ ability to detect electricity theft by providing daily readings for the electric meters. “If a service shows off in our system but is showing consumption through daily reads, we receive a report and send a field employee to investigate.”
In addition to smart meters, new distribution system meters installed into the power grid can measure electricity supplied to specific areas. Used in combination with analytical software tools, these meters also help identify electricity theft more accurately and quickly.

Even though these new technologies are helping limit electricity theft, officials admit it remains a significant problem that is pervasive throughout the U.S. And while advanced metering infrastructure can help, in some instances thieves have hacked the smart meters, indicating that electricity theft is not likely to go away anytime soon. That being the case, Isaacson encourages anyone who suspects electricity theft to contact Springs Utilities at 448-4800 or askus@csu.org and report any suspected theft.

Ironically, the state of Colorado may have inadvertently avoided a major motivating factor in electricity theft. In a recent keynote speech at an industry conference, BC Hydro’s Hogan spoke to his colleagues about the growing problem of electricity theft in British Columbia: “We don’t know where [the electricity] all goes, but we do know the majority goes to growing marijuana.”

England faces a similar problem, with the U.K. Office of Gas and Electricity Markets estimating that a third of stolen electricity goes to “indoor cannabis farms,” costing ratepayers hundreds of millions of pounds per year. So when Colorado voters approved Amendment 64 last year, they unwittingly de-incentivized electricity theft for black-market grow operations by making marijuana cultivation a legitimate business.