State governments have urged the Federal Government (FG) to enforce a “no-meter, no-service” policy for all new electricity connections in an effort to tackle the metering issues within Nigeria’s power sector.
This call to action is outlined in the Development of the National Integrated Electricity Policy & Strategic Implementation Plan: Policy Recommendations by State Governments to the Federal Ministry of Power document from the Nigeria Governors’ Forum and seen by Nairametrics.
In the document, state governments highlighted the critical importance of electricity meters in bridging the significant metering gap, which is essential for the viability of sub-national markets.
The states also argued that State Electricity Regulatory Commissions (SERCs) should have the autonomy to determine the most suitable meter technology, type, and form for deployment within their respective electricity markets.
The document read: “States believe that the provision of electricity meters to close the huge metering gap is a necessary requirement to make sub-national markets viable. However, SERCs in conjunction with the Distribution Licensees should be allowed to determine the meter technology, type and form of meters to be deployed within their States electricity markets, taking into consideration the cost of meters, extent of the telecommunications coverage in the State, tariff methodologies adopted by the SERC (fixed tariff, time of use, etc) and metering requirement in urban and rural communities and across customer categories arising from their energy consumption.
“States are of the view that the national electricity policy should mandate an immediate “no-meter, no-service” policy for all new connections, to prevent the metering gap from further increasing.
The need for low-cost metering schemes
The states also called on the FG to facilitate low-cost, long-term funding for metering schemes. This could be achieved through direct loans to Distribution Licensees or through off-balance sheet funding via special purpose meter finance companies or meter asset special purpose vehicle (SPV) companies.
Moreover, the document suggested that electricity customers should be encouraged to purchase prepaid meters directly from accredited meter asset providers and manufacturers approved by the SERC.
The document noted: “The Federal Government is urged to provide low-cost, long-term funding for metering schemes as direct loans to Distribution Licensees or off-balance sheet funding through special purpose meter finance companies (or meter asset SPV companies) to close the metering gap, whilst also encouraging electricity customers to directly purchase prepaid meters from accredited meter asset providers and manufacturers accredited by the SERC. States on their own will implement their viable metering programs and metering regulations to close the metering gap within their state electricity market.”
What you should know
- Earlier this year, the Minister of Power, Adebayo Adelabu said the federal government is committed to ending estimated billing in the nation’s power sector by the end of this year. The minister also noted the substantial metering gap in Nigeria, stating that around 50% of customers within the coverage area still lacked proper metering.
- A report by the Nigerian Electricity Regulatory Commission (NERC) showed that out of the total 12,825,005 registered electricity customers, only 5,707,838 have meters, indicating that over 7.1 million registered customers are subjected to the estimated billing system.
- The overall metering rate across all DisCos was about 44.51%. Ikeja DisCo had the highest metering rate at 72.0%, while Yola DisCo recorded the lowest at 18%.
- Customers without meters are required to pay a fixed, estimated charge, regardless of the erratic supply from the aging grid. Last year, 57% of all complaints received were about disputed bills, according to a report by the Nigerian Electricity Regulatory Commission (NERC).
- To close the metering gap, the federal government plans to procure 3.5 million electricity meters by the end of the year to improve revenue for its cash-strapped power sector, where more than half of the customers are billed by estimates.
- About N20 billion was released to the power distribution companies (DisCos) for the procurement of meters for unmetered Band A customers in the next three months.
