Malta's smart meter scandal -- $41 million worth of electricity stolen



Quick Take:  When a utility installs smart meters, it assumes they will make it easier to spot energy theft. What a utility may not realize, however, is that smart meters also make it easier for clever hackers to steal power.


That's precisely what happened in Malta, and at a massive scale. As you'll read, a full 10% of all the power generated by the island nation's utility was not paid for.


So utilities should continue to ask their revenue protection department to scan for theft at the individual level. But they may also want to be on the lookout for sophisticated, large-scale operations. Smart meters are a two-edged sword. At the same time they offer advantages, they also introduce new vulnerabilities. - By Jesse Berst


Malta's current and former energy ministers are currently in a slap-fest over who is to blame for a massive energy theft operation. Current energy minister Konrad Mizzi claims former energy minister Tonio Fenech knew about the racket but failed to take action. For his part, Fenech has filed a libel suit against Mizzi.


Authorities recently discovered that at least 1,000 smart meters had been tampered with to record lower electricity consumption levels. According to the Malta Independent, those running the racket had charged €1,200 (about $1,600) per residential smart meter. They had a higher charge to tamper with a commercial or industrial meter.


The scam amounted to some 10% of the total generation of electricity by Enemalta, the island's power utility, costing taxpayers around €30 million (roughly $41 million) in 2012 alone. Three Enemalta employees have now been suspended for their roles in the scam and charged with crimes. One former technician has already been sentenced to two years in jail for his role. It appears prosecutors may also pursue some customers as co-conspirators.


Jesse Berst is the founder and Chief Analyst of SGN and Chairman of the Smart Cities Council, an industry coalition.


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