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Prepaid meters: NERC to sanction defaulting power firms

By on April 25, 2016

Against the backdrop of the statement by electricity distribution companies that they cannot provide one million prepaid meters to customers yearly, the industry regulator has said it will sanction any Disco that fails to live up to its performance agreements.

The Acting Chairman and Chief Executive Officer, Nigerian Electricity Regulatory Commission, Mr. Anthony Akah, in a telephone interview, told our correspondent that the regulator may have to introduce more interventions to protect the consumers from undue estimated billing.

He said, “NERC has directed the Discos to meet up their metering obligations in line with the performance agreements. And therefore, we are going to look into the number of meters they are supposed to do and hold them strictly accountable. There is no going back on that.

“If they fail to meter consumers in line with those clear agreements that were duly signed, then we will have to sanction them and may have to come out with other regulatory intervention to protect the consumers from undue estimated billing.”

The Discos had on Wednesday said the cap on their capital expenditure was a hindrance to meeting the deadline given to them by the Federal Government to meter one million electricity consumers annually.

Reacting to this, the NERC boss said, “We are willing to allow the Discos to front-load part of their capital expenditure provided it is strictly dedicated to rapidly metering customers.

“They can come for a rate review, asking that we should allow them to have part of their capex for the upcoming years now, provided we, as the regulator, make sure that it is deployed to this critical area, which is metering. For us as the regulator, mindful of the vexing issue bothering the consumers, we are not going back in our determination to hold then fully accountable on meeting up the metering agreements that they signed up to,” Akah added.

Many electricity consumers in the country have continued to decry the non-provision of prepaid meters by the Discos, with rising complaints about what is popularly called “crazy” bills.

Based on the proposals submitted by the core investors in the Discos during the privatisation of the power firms in 2013, about 6.52 million new meters will be installed over the course of five years, meaning more than one million will be installed yearly.

NERC, while evaluating the performance of the Discos on the Credited Advance Payment for Metering Initiative in a meeting on Wednesday, said the firms had performed poorly in terms of metering their customers.

As of March 2016, the Discos had collectively metered just 403,255 customers since they took over, with about three million currently without prepaid meters.

According to NERC, data submitted by the Discos indicated that there were about 6.2 million customer accounts as of December 2015, while about 3.21 million electricity users were metered.

The President, Association of Small Business Owners of Nigeria, Mr. Femi Egbesola, said, “The fact is that we have had series of complaints about lack of prepaid meters. Quite a number of people have paid for the past four to six months, and they have not been able to get the meters.

“For many of those who do not have the meter, the bill has always been arbitrary. In fact, we are contemplating having a lawsuit against one of the Discos where many of our members have their factories because they placed them on the category of big companies.”

Egbesola said the government should revoke the licences of Discos that failed to fulfil their performance agreements in the area of metering.

He said, “The crazy bill has been very challenging to businesses. We have some that are receiving crazy bills of as much as N400,000 per month, even when there is no ‘light’. It is a very serious issue that is affecting the populace.”

The Director-General, Lagos Chamber of Commerce and Industry, Mr. Muda Yusuf, stressed the need for the government to put measures in place that would make the Discos to accelerate the provision of prepaid meters to customers.

He said, “From all indications, the idea of estimated billing seems to be profiting the Discos, and perhaps, that is why they are not too keen to accelerate the process of provision of meters. The issue of metering is very important because people want to be seen to have been billed fairly for what they consumed.

“People feel very bad when they receive a bill that is higher than what they have consumed. Metering is very critical and whatever it will take, the process needs to be accelerated. The pace of the deployment of meters now is very slow.

“The government should get the Discos to be up and doing because the lack of metering provides room for exploitation of the consumers. That is the problem. And we should not create conditions that will allow any form of exploitation to thrive. It is even more painful at a time when the power supply is so poor that people are getting high bills.”

An energy expert, Mr. Bala Zakka, said the lack of prepaid meters was affecting the investment of so many people in the country.

He said, “Because whenever you have an investment, electricity comes under expenditure. If you have a prepaid meter, it helps you to have an idea of your consumption and it helps you in planning.”

 

[Punch]