Billions of dollars worth of electricity is pilfered every year, sending power to individual homes and businesses as well as more large operations, such as marijuana farms.

A study from the Electric Power Research Institute in 2006 estimated that “non-technical losses,” or losses from theft or tampering, was $6.5 billion. That number is much higher in other countries where tapping into power lines is routine, both by people who can’t afford electricity as well as big companies and the well-to-do, according to the World Bank, which says energy theft is particularly severe in India, Brazil, and other parts of Latin America.

Reducing energy theft is one of the justifications for advanced power meters because they are accurate and, since they continually send consumption data to utilities, can quickly spot unusual activity. In 2009, the World Bank published an analysis of energy theft and recommended that advanced meters be put in place because, among other reasons, theft raises the prices of electricity for others. Losses during distribution and transmission in India, for example, were as high as 38 percent in 1999, which was cut to under 20 percent by 2008 in large part by controlling theft, according the World Bank.

But often thieves will simply tap power lines before they reach the meter or, for more sophisticated theives, draw power from high-voltage lines, says Mischa Steiner-Jovic, the CEO of Awesense, a company he founded three years ago to tackle energy theft. Its theft-detection method doesn’t require smart meters, offering a relatively simple and inexpensive way to pinpoint where power is being diverted illegally.

Awesense sells a sensor that a line worker attaches to power lines. The battery-powered clamp measures the amount of current flowing through, calculates power consumption, and sends the data back to Awesense’s hosted application called SenseNET.

By comparing actual consumption to billed electricity, the back-end software can determine if some theft is happening in that area, usually within a day, according to Steiner-Jovic. The clamp-on sensors are normally only in place temporarily and then moved to another spot.

On Tuesday Awesense is announcing a managed service where it will do the work of attaching monitors and generated the data. Instead of having a utility buy the system, Awesense will be paid by sharing savings from throttling theft.

The system has been used by a “handful” of utilities in North America and the Vancouver-based company plans to expand into Europe in the first quarter with pilot tests, Steiner-Jovic says. In its first trials, the company found theft can add between $50 to $200 in electricity bills a year. The company has been funded by a round from angel investors last year.

It’s also a very dangerous to tap live power lines, which can cause shocks or fires, according to Michigan-based Consumers Energy which deals with 70,000 cases a year. “Not only is energy theft illegal it is also a safety threat - to those who tamper with electric utility equipment, to the general public and to utility workers who can be injured or killed by hazards left behind by the culprit,” said Chuck Walls, vice president of customer financial operations of ComEd in a release about its help in convicting a local man for stealing power.