Prepaid Meter: Defaulting Discos Blame Forex Scarcity for Failure to Heed NERC Directive

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A prepaid meter

Ejiofor Alike

Electricity distribution companies (Discos) that have failed to comply with the new metering scheme, almost three years after it was introduced by the Nigerian Electricity Regulatory Commission (NERC) to ensure that consumers are not billed based on estimation, have now blamed their failure on lack of access to foreign exchange.

The scheme tagged: Credited Advance Payment for Metering Implementation (CAPMI), which became effective in May 2013 was initiated by NERC to address the slow pace of customer metering by the 11 distribution companies, as well as the high level of complaints received from customers and dissatisfaction with estimated billing practices.

The scheme provides a platform for willing customers to pay the cost of the meter into a dedicated account jointly managed by each Disco and its meter vendor/installer and once payment has been effected, the customer will have his meter installed within 45 days.

While many of the Discos have commenced the implementation of CAPMI with the rolling out of meters to their customers, others, who have failed or neglected to implement the programme are now claiming that the recent forex scarcity hindered them from implementing the new metering programme.

NERC had in October 2015 handed a fine sum of N131, 400,000 to Ikeja Electric, one of the defaulting companies for not implementing the CAPMI to provide meters for customers who paid within 45 days.

The agency had also ordered the 11Discos on August 17, 2015 to satisfactorily explain customers’ status that paid for meters under the CAPMI.

A top official of one of the Discos, which has not implemented CAPMI, claimed that the high cost of dollars had made it difficult for some of the companies to arrive at the appropriate price of the meters that would be affordable to consumers.

“When some of these agreements between the Discos and the meter vendors were signed, the exchange rate was around N170 to a dollar and the cost of single phase pre-payment meter was around N25, 000. The cost of dollar today is over N350 and with this scarcity of forex, consumers will not be able to pay the appropriate commercial price for the meters. If we roll out meters at this stage, consumers will accuse us of extortion because the cost will be high,” the official, who would not want his name in print, explained.

Meanwhile, the 11 Discos under the aegis of the Association of Nigerian Electricity Distributors (ANED) have called on the federal government to give distribution companies a priority in the allocation of foreign exchange at official exchange rate.

ANED’s Executive Director in charge of Research and Advocacy, Mr. Sunday Olorutimi Oduntan , who admitted that the issue of scarcity of forex had affected not only the power sector but all other businesses in the country, said it was “not entirely true” that the Discos were not rolling out meters due to the scarcity of forex.

He however noted that the forex issue has affected the entire power sector because over 90 per cent of the equipment used in the sector is imported from overseas.
“When you talk about foreign exchange, you cannot single out meter. There is no doubt that the whole power sector and all other businesses are affected because most of the equipment used in the sector are imported. But the issue of Prepayment Meter (PPM) is that you don’t buy it off the shelf. You order for it; you pay for it; you bring it down and do the configurations before you install it. This process takes time. We should not give the excuses of forex exchange. What we are saying that we should be given priority on allocation of foreign exchange at official rate,” he explained.

He said the metering gap arose from the huge deficit inherited by the private investors, as according to him, over five million customers did not have functional meters when the new investors took over.

“Each Disco can only install a maximum of 20,000 meters monthly. That is why the gap is still very huge but our major problem is how to ensure that the customers pay the new tariffs,” he added.

The immediate past chairman of the Nigerian Electricity Regulatory Commission (NERC), Dr. Sam Amadi disclosed recently that the last regulatory audit of the metering gap in Nigeria’s power sector showed that up to two million electricity consumers are yet to be provided with prepaid meters by the Discos.

  • Isreal Bethel

    These Discos are evils, while on earth will they blame their inability to supply meter on Forex when we have company producing meter here in Nigeria, I remember when my former company engage EMCON Meter LTD, Kaduna to supply meter to one of our mass estate it take them less that 4months to do that. how can forex problem of mid 2015 to early 2016 affect people that paid as far back as 2013 and 2014.