There are strong indications that millions of electricity consumers in the country who are yet to be metered may have to wait for a long time as the estimated billing system of electricity distribution companies (Discos) continues to generate controversies.
Investigation revealed that uncertainty still surrounds government’s implementation of electricity meter policy which many describe as exploitative, especially in the face of many challenges facing the Discos whose responsibility it is to ensure customers are adequately metered.
Part of the challenge, according to some stakeholders, is government’s regulation and lopsided policy that has not totally allowed full deregulation of the sector.The 11 Discos operating across the country have so far collectively provided 403,255 meters to their customers in a concerted effort to bridge the metering gap in the country.
Figures from the Nigerian Electricity Supply Industry (NESI) indicate that out of a 6,159, 775 customers only 3,206,599 customers or 52 per cent have so far been provided with meters leaving a yawning gap of 2,953,176 unmetered customers.
The Federal Government had at various times made promises to tackle electricity meter-related challenges but the problem which gave rise to the exploitation of consumers largely remains unresolved.The Nigerian Electricity Regulatory Commission (NERC), the statutory agency mandated to regulate and monitor the electricity industry in 2012 said pre-paid meters would be provided free to consumers and that provision had been made for free installation of the meters in the new electricity tariff which took effect from June 1, 2012.
The NERC also claimed that the Discos had been provided with funds to ensure the success of the campaign billed to last for 18 months. But a counter directive was issued shortly after requiring consumers to pay between N25,000 and N50,000 under the Credited Advance Payment for Metering Implementation (CAPMI).Unfortunately, there appears to be no headway as consumers continue to groan under huge bills under the unpopular estimated billing process. Also, the Discos, despite close monitoring by NERC have clearly said customers would have to stay without meters even for upward of two years.
It was gathered that the current challenge is not a matter of whether meters are available or not, but rather the Discos are highly incapacitated financially to procure and install meters for customers.Local meter manufacturers say they are ready to meet the demand for meters, particularly with the Central Bank of Nigeria’s (CBN) new policy of regular release of forex into the market.
Chairman of Momas Electricity Meters Manufacturing Company Limited (MEMMCOL), Engr. Kola Balogun told our correspondent his company obtained $60,000 from the one recently released by the CBN.He said the new forex policy would go a long way to facilitate product manufacturing campaign as he expressed optimism that more of such funds would help to realise government’s meter roll out policy for the Discos.
He, however, said availability of meters was one thing, while the ability to buy them by the Discos for the consumers was another, adding that “Momas has over 50,000 monthly production capacity installation and allowance for expansion if demand warrants”.Meanwhile, the executive secretary of the Association of Electricity Distribution Companies of Nigeria (ANED), Barrister Sunday Oduntan, told LEADERSHIP Sunday on telephone that though the Discos were eager to accelerate the process, the current tariff structure was a great obstacle.
The new electricity tariff introduced by the NERC under its Multi-Year Tariff Order (MYTO) 2015, became effective on February 1, 2016. Under the new tariff, residential customer category (R2) in the Federal Capital Territory, Niger, Nasarawa and Kogi States served by the Abuja Electricity Distribution Company (AEDC) franchise, who previously paid N14 per kilowatt/hour, will now pay N23.60 per kilowatt/hour.
Similarly, residential customers in Eko and Ikeja electricity distribution areas will be getting a N10 and N8 increase respectively in their energy charges. The same applies to residential customers in Kaduna and Benin electricity distribution areas who will see an increase of N11.05 and N9.26 respectively in their energy charges.
Many Nigerians have continued to express dissatisfaction with the implementation of the new tariff, just as some commercial and residential consumers groan under huge estimated bills, incessant power outages, lack of prepaid meters and ageing equipment, associated with the Discos’ neglect of the electricity sector.
The Discos said the tariff was a disservice to the sector because they could not recover cost after power purchase, including other operational costs.
“Meter project is not done the way Nigerians calculate it. We buy power from the generation company, and we have to take care of other operational challenges, and then we are expected to meter customers, a project that is highly capital intensive.
“We still receive high invoices from the Gencos to the Discos at the downstream. Let’s consider the simple calculation, if we buy a product at N68 and we are only allowed to buy the fixed tariff to sell at N31 who bears the responsibility of the shortfall of about N37?”, he asked.
He painted a picture of the current situation and challenges, pointing out that “government has fixed a tariff without considering how much we pay for electricity purchase, and now we sell the power to consumers lower than we procure so how do we carry on with our business?”.
He challenged the government on the tariff structure and said so long as it (government) had refused to do the right thing, many customers would have to stay without meters. He warned that the sector might collapse if government failed to expedite action on resolving the lingering problems.
“Metering is just an aspect of it. What about transmission and generation. Generation has continued to fluctuate and recently Egbin threatened to shut down, so the chain is heavily challenged”, he added.
Speaking on the claim that Discos reject load, Oduntan dismissed the allegation, blaming the situation on Transmission Company of Nigeria (TCN), whose facility he said was obsolete.
Only recently, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Dr. Maikanti Baru accused the Discos of frustrating the efforts by the government to stabilize power supply in the nation.
The NNPC boss said the constant rejection of load by the electricity distribution companies had been a major factor preventing the evacuation of 4,500mw of electricity from the national grid to the consumers.
But Oduntan accused the TCN of wheeling electricity to areas not profitable to Discos. He said, “It’s because their equipment is weak, they push power to areas their facility can reach which are not prime demand areas of Discos. We are all in business and it is our desire to service all customers but as business concern we give priority to areas that can create value.
“Take for instance, I have a warehouse in Abuja, Kaduna and Lokoja, and the road to Lokoja is bad and I ask my supplier to service Abuja and Kaduna warehouses because it’s cost effective and he takes my product to Lokoja, would you want me to accept that?. This is what TCN considers as load rejection.”
Oduntan, urged government to properly fund the TCN, adding at the moment there are transmission bottlenecks at Gwagwalada, Kano, while Ibadan-Sagamu is seriously constrained so much so that even if there is electricity in those areas, consumers would not enjoy it because of poor transmission.
Source: Nigeria Today