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This paper provides insight into the illegal use or abstraction of electricity in the Netherlands. The importance and the economic aspects of theft detection are presented and the current practices and experiences are discussed. The paper also proposes a novel methodology for automated detection of illegal utilization of electricity in the future distribution networks equipped with smart metering infrastructure. The necessary data requirements for smart meters and distribution substations are defined, in order to unlock this feature in distribution network. The paper also proposes the measures, which should be undertaken by the smart metering standards.