NERC’s Inconsistency And Development Of Nigeria’s Power Sector


The authenticity and unbiased position of a regulator like the Nigerian Electricity Regulatory Commission (NERC) was again call to questioning when it reversed itself on an earlier directive stopping electricity consumers from paying bills without the provision of pre-paid meters by the Distribution Companies (DisCos) operating across the country.

The Commission for the first time won the heart of Nigerian electricity consumer when it  announced through a statement it posted on its website on June 9, 2017, that  ordered consumers not provided with prepaid meters as at March 1, 2017, to stop paying electricity bills based on estimated billing methodology.

In addition, the Commission also ordered the DisCos not to disconnect any such customer that refuses to pay the bills and further advised such customers to report to the commission if disconnected.

NERC explained that in line with its mandate of protecting the rights of customers, it had in June 2016 after consultation with the operators, directed DisCos to conclude metering of all customers before November 30, 2016.

Many Nigerians especially those who have been clamouring for the provision of prepaid meters in the homes and offices heaved a sigh of relief thinking the development would  help hasten operators of DisCos to start issuing the meters.

But barely 24 hours after the publication of the statement on its website, the umbrella body of DisCos, the Association of Nigerian Electricity Distributors (ANED), came out with a clarification on the widely published announcement.

Chief executive officer of ANED, Mr Azu Obiaya, who made the clarification in an interview with the News Agency of Nigeria (NAN), in Abuja, stated that the directive by NERC to consumers not to pay estimated electricity billings only applies to Maximum Demand (MD), customers stressing that the order did not include residential consumers.

Explaining further, Obiaya said, MD customers are commercial and industrial customers who consume high levels of electricity and contribute substantially to the revenues of distribution companies.

According to him, only those within the consumption threshold of 45KVA are qualified for the MD specification.

While acknowledging the residential consumer to the NERC announcement, Obiaya said, “We recognise that our residential consumers will be interested in this notice thinking that it applies to them in their need for meters, and we recognise that everyone will like to be metered, we are working towards that.

“But this time, that notice by NERC is specific for maximum demand customers. Yes, it is a challenge, but we are working hard to ensure that we meter all the MD customers to eliminate issues associated with estimated billing that those customers have.”

While the residential customers and the general public were still waiting for the regulators to come to their aid, NERC came out with a press statement signed by Mrs Vivian Mbonu, AGM, Media titled: “Only Maximum Demand Customers Exempted From Estimated Bills.”

Part of the statement reads; “Further to the directives over the weekend of 9th June, 2017 on the verification and validation of the Maximum Demand (MD) electricity customers metering exercise, the Commission wishes to clarify that the affected electricity customers are those within the threshold of 45kVA consumption and above.”

NERC stated that, the underlying rationale for issuing the directive is the effect, stressing that the said category of customers have been completely metered as directed by the Commission and reported by the DisCos.

Referring to residential consumers the statement said, “For non- MD unmetered customers on their networks, electricity distribution companies have been warned to adhere strictly to the Commission’s approved estimation methodology in accordance with the Estimated Billing Methodology Regulation.

“Electricity customers are also advised to avail themselves of the Commission’s redress mechanism in instances of contested bills before seeking legal advice,” it added.

The clarification which confirmed the position of ANED left many Nigerians wondering if NERC was not already compromising its stands. Since by implication, the majority of consumers who have hope that the directive would have forced DisCos to meter them were disappointed.

Many Nigerian are sceptical of the role of NERC in regulating the power sector with some analyst arguing that the regulator was failing in its duty to compel the DisCos to provide meters.

The perception may have been further dented with the refusal to extend the directive forcing DisCos provide meters to the residential consumers who in most cases suffer the burden of the overbearing cost implication of the estimated bills.

Source: Leadership

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