The Federal Government through the Ministry of Power, has been urged to sensitize Nigerians more on its recent move to make electricity consumers pay to acquire meters.
The call came from a top source close to the Ministry of Power, following the sudden reversal in the meters allocation programme of the government.
He said there should be a circular from the Federal Government to that effect, showing that government had gone back to the status quo, which required that Nigerians are to pay for meters.
The source noted that the initial directive by the Nigerian Electricity Regulatory Commission that meters would be given to electricity consumers for free, caused a huge set-back for the sector.
He said, “The situation then was that government stopped giving the Power Holding Company of Nigeria money to buy meters, and at the same time, NERC was saying the meters were free and there was no need to pay maintenance fee.
“PHCN, as a result of this, could not make any progress. It was a serious national embarrassment.”
Assessing the impact of the decision, an electric power consultant and former Business Development Manager, Orile District, Power Holding Company of Nigeria, Mr. Sikiru Salami, told our correspondent that it was possible there were huge cases of energy theft during the period NERC declared meters to be free.
He said, “Naturally, during theis period, the hands of PHCN was tied. It had no funds since consumers stopped paying for meters. The irony then was that consumers were ready to pay to acquire meters; but they couldn’t pay. This would have given room for some sort of energy theft.
“Are they telling us that during that period there were no new connections or developments? In my opinion, we cannot quantify the amount of energy that was lost during this period.”
He said aside the possible energy theft, PHCN also lost lots of money it could have made from the sale of meters.
Salami, who was also the pioneer BDM, Lekki District PHCN, and had worked at the Egbin Power Station as an instrument engineer, called for less politicisation of the of a crucial sector like power.
He advised government to allow technocrats to direct the affairs of the sector if it wanted meaningful progress in the entire privatisation process currently being concluded.
NERC had recently risen from its board meeting and reversed its earlier ruling that electricity distribution companies should provide meters for all consumers by November 2013 at no cost.
The Chairman, NERC, Dr. Sam Amadi, had said in order to ensure rapid deployment of meters, willing customers could pay for them and recover the money through the payment of lower bills.
In June 2012, NERC had announced that the new Multi-Year Tariff Order (II) provided sufficient funds for meters and that customers were no longer required to purchase them.
Consequently, the regulatory body gave the electricity distribution companies a deadline of 18 months to provide meters to all consumers at no extra cost.
However, Amadi said that NERC was disappointed at the progress made so far and that it needed to make a new intervention to ensure that electricity consumers could get meters and eliminate arbitrary billing.
He said, “Seven months after the pronouncement, there is an unacceptable number of electricity customers who are without meters. Compounding the issue is the menace of unrealistic estimated bills or ‘crazy bills.’
“This has compelled the commission to explore alternative ways of ensuring the quicker deployment of electricity meters to customers.”
Amadi said two options were now open to close the huge metering gap in the Nigerian electricity industry.
The options are customer financing and installation by accredited vendors.
Under the first option, willing customers can advance money to the distribution companies after which a meter would be installed in their premises within a period of 54 days.
In exchange for this, the companies will in turn reduce the customer’s electricity bills on a monthly basis in line with the amount originally advanced by the customer.
With the second option, the commission will accredit vendors to supply and install meters directly to customers. Payment modality for this option will be worked out by the regulatory body.
The regulatory body also said it would write the Bureau of Public Procurement to fast-track a no objection certification for the various meter vendors.
Amadi attributed the failure of the distribution companies to meet the metering needs of their customers to increasing operating expenditure, even though the money for the meters had been provided in the fixed charges of the MYTO II.
He said, “The commission had made a pronouncement that meters were free and customers were no longer required to pay for them as the cost was being recovered through the electricity tariff. The recovery is done through the payment of the fixed charge. A portion of the fixed charge goes towards a fund for the purchase of meters by electricity distribution companies.
“The second Multi-Year Tariff Order was designed to allow for, amongst others, the accumulation of sufficient funds for the Discos to carry out a comprehensive meter roll-out programme. Unfortunately, the revenues that were projected have not been sufficient partly due to increases in operating expenditure, particularly staff salaries.
“Consequently, majority of retail customers are still not metered. There is also a high level of dissatisfaction with the current way and manner customers are being billed by the electricity distribution companies, and these customers have made innumerable complaints.
“A key focus for 2013 is comprehensive metering, and this remains a priority of the commission. To this end, NERC is compelled to look inward with a view to addressing this metering issue.”
The commission also said it would compel the distribution companies to install meters in the premises of customers who had earlier paid for them.
