The News Chronicles’ findings indicate that 5.8 million unmetered customers pose a challenge to the federal government’s ambitious goal of supplying premium power to every individual.
Minister of Power Adebayo Adelabu revealed the federal government’s intention to reduce the number of power sectors from five to one within the next three years over the weekend.
The Nigerian Electricity Regulatory Commission classifies electricity into five bands: A, B, C, D, and E. Each band entitles customers to a specific minimum number of hours of power supply per day.
During a weekly briefing last week, Adelabu stated, “This tariff review conforms with our policy thrust of maintaining a subsidized pricing regime in the short-run or the short-term with a transition plan to achieve a full cost reflective tariff for over a period of, let us say three years.”
With 5.8 million unmetered users, analysts are still dubious about how the new approach will succeed in reaching this goal.
Without advancing metering, Tunde Osunlusi, an energy expert at an investment firm in Lagos, stated that reaching the goal of placing everyone on Band A would be an enormous undertaking.
“Metering is a critical component for power improvement because it’s important to talk about lowering AT&C losses or supplying premium power,” stated Osunlusi.
According to Aisha Mohammed, an energy analyst at the Centre for Development Studies in Lagos, metering progress is still lagging behind anticipated goals.
“Nigerians, even those with the means to pay in advance, have expressed dissatisfaction at the difficult process of obtaining a metre. It is impossible to increase energy access without metering,” Mohammed explained.
According to a recent National Bureau of Statistics power report, the number of consumers who understated their bills fell by 1.73 percent to 5.8 million.
The Nigerian Electricity Regulatory Commission (NERC) recently announced that, as part of its sanctions against the 11 power distribution companies (DisCos) for their noncompliance with the capping of estimated bills for unmetered customers, it would deduct N10,505,286,072 from their annual allowed revenues during the next tariff review.
According to NERC’s explanation, the DisCos would reimburse roughly 10% of the excess amount they overcharged their clients from January to September of 2023.
In addition, the regulator mandated that the DisCos guarantee future compliance and fully reimburse the impacted customers. It emphasized that a 10 percent fee had been placed on the utilities to discourage similar incidents in the future.
“Corruption in the metering supplier chain exacerbates the poor pace of meter placement. According to researchers at Energy Markets Rates and Consultants, “this includes misappropriation of funds designated for new meters and imposition of unauthorized fees on customers, a clear misalignment with the regulatory provisions for meter procurement.”
“A lot of customers are usually hesitant to accept the installation of meters because they are worried about the upfront costs, think it will be inconvenient, and are afraid of switching to a new billing system,” they continued.
According to TNC’s research, single-phase meters cost N82,000 in April 2024, while three-phase meters cost N259,000.
“Why do you claim that Nigerians are unable to purchase electricity meters for their residences? Mohammed stated that the government ought to concentrate on cutting out the intermediaries from the value chain.
Before the electricity industry was privatized, Nigeria had a massive metering gap that was projected to be more than 3 million in 2012. The Discos had an agreement with NERC and the Bureau of Public Enterprises to close this gap when they took over in November 2013.
Since this goal was not fulfilled, in March 2013, NERC approved the introduction of Credit Advance Payment for Meter Installation (CAPMI), a system in which customers pay for meters upfront using credits that will be deducted from their future electricity bills.
However, the plan did not turn out as planned. 2016 saw the cancellation of CAPMI in September.
Mohammed claimed that the “estimated billing system is outrageous and fuels inefficiency and more corruption within the electricity supply chain.”
