Tackling Poor Service Delivery among DISCOs


Despite efforts by the federal government and the regulator to entrench the culture of service delivery among the electricity distribution companies, Ejiofor Alike reports that the institutional arrogance and impunity that characterised the old National Electric Power Authority have continued to manifest in the firms

Addressing the 11 monthly power sector and stakeholders meeting held recently at Ikeja West Transmission Station in Lagos, the Minister of Power, Works and Housing, Mr. Babatunde Raji Fashola warned the staff of the distribution companies not to pick the telephone and respond to customers’ calls when they are in a bad mood in order to avoid being rude to customers.

The minister, who harped on the need for improved service delivery, revealed that he received a complaint from a professor at the Rivers State University of Science and Technology, informing him of a rude behaviour of a staff of the Port Harcourt Electricity Distribution Company (PHEDC) and warned the power distribution firms to improve on their service delivery or be ready to quit the sector.

“We all know the issues around metering and billing. We must build that trust and confidence that customers complains will be addressed. Without the customers and the consumers, there is no business and I think that all of us in the public and private sector must understand that. If you don’t have the skin and the patience to serve, leave,” Fashola said.
He informed the distribution companies to use 2017 to tell their workers that without the customers, they do not have a job, stressing that if they are not in a good mood, they should not pick the telephone.

“As a public appeal, we need to do whatever is possible in our various distribution areas to improve the quality of service, train personnel, recognise that the customer is king. And even if we cannot provide or solve the problem, we owe it a duty to explain what we are doing. It is a thankless job. I am conscious of the challenges operators in the sector face. My team and I are working as hard as we can to make the environment more conducive to you and as I have always said that as pioneers, you will carry some burden. You will have to sacrifice perhaps more than what you have done but I am optimistic that it will get better. I am optimistic that we can win together and we can win for the Nigerian people,’’ the minister assured.

Speaking on the liquidity challenges that have plagued the sector , Fashola also stated that the government is working with development, local and international partners, who according to him, have shown commitments and inspiring appetite to play in the market in a bid to stem the tide of underfunding.

‘‘Our partners in government are also inspiring and understanding of what the challenges are. So it is quick decision making now. Collaboration and decisions will be fair but firm and we expect people would respect the decisions and also processes to be introduced along the line. These are matters the regulator – Nigeria Electricity Regulatory Agency (NERC), will have to deal with, the bulk trader, Nigerian Bulk Electricity Trading (NBET) which is in-house, Ministry of Finance, and Ministry of Petroleum in terms of gas and all other players will dovetail into one another. I think the owners of this business must look inside and do what is possible. We have spoken about undercover boss here before. Go round and ask your consumers what they are facing and this will inform your management decision on what to do,” Fashola explained.

Poor service delivery

Indeed the power sector is plagued by hydra-headed challenges, but some of these challenges were deliberately inflicted on the customers by the arrogant staff of some distribution companies, who have continued to operate under the mindset of the public sector monopoly enjoyed by the defunct NEPA and PHCN.

Since the power assets were handed over to the new investors on November 1, 2013, some of the Discos have demonstrated lack of capacity to embrace the new order, where customer is king.
Some of the Discos intimidate and extort customers by disconnecting them at will without notice, contrary to NERC’s guidelines.

Fashola had earlier advised that the Discos “who cannot run the business must be honest with themselves now and begin to look for options either to raise capitals, to get more strategic partners in or to do whatever they consider appropriate within the framework of their contract in order to get on with this job.”

But some of these distribution companies still flout market rules, blackmail the government, conceal their financial records to hide their level of extortion of customers through estimated billings and also disconnect customers without notice, contrary to the NERC’s guidelines.
The names of some Discos have featured prominently for poor service delivery as their field workers have continued to engage in malpractices against customers as evident by the massive protests in many areas by aggrieved customers against the activities of unscrupulous staff of some of these companies.

Though the speed with which the top managements of the companies respond to reported cases of infractions by the field workers is commendable, the managements may have also contributed in no small measure to the woes of the customers through some unpopular management decisions, especially in the areas of billing and metering.

Sanctioning culprits
It is on record that Ikeja Electric was the first Disco to be sanctioned by NERC to the tune of N131.4 million for “flagrant breaches” of the Credited Advance Payment on Metering Initiative (CAPMI) Order, enabling act of NERC and terms and conditions of its licence.

CAPMI was an initiative of NERC to assist the electricity distribution companies close the wide metering gap in the Nigerian Electricity Supply Industry (NESI). It was introduced following a nationwide study conducted by NERC which revealed that more than 50 per cent of electricity consumers are not metered but are on estimated billings.

The high level of impunity displayed in the power sector under the private sector-led electricity market is not restricted to Ikeja as virtually all the electricity companies in Nigeria had been hit by the regulatory sledge hammer for failing to play by the rules.

NERC had also fined Benin and Port Harcourt electricity distribution companies N6.220 million over failure to comply with the decisions of Forum Offices rulings in complaints filed by their respective customers.

The agency had also has fined Ibadan, Ikeja, Port Harcourt and Enugu Discos millions of Naira for breaching the terms and conditions of their licences and the provisions of the Electric Power Sector Reform Act 2005.

More recently, NERC fined Afam Power Plant, and Eko Electricity Distribution Company (EKEDC) the sum of N66.6 million for failing to submit audited financial reports for 2013 and 2014.
These fines have since attracted additional N62 million, being the cumulative for five per cent interest daily for I9 days following the expiration of the two weeks grace granted by NERC, which expired on the December 22, 20I6.

Acting Chairman of NERC, Dr. Anthony Akah, had explained that Directive 162 of NERC found Afam Power in breach of its licensing terms and other operating conditions when it failed to file audited financial report for 2014, and subsequently liable to pay N18.510 million.
According to him, Directive 163 found EKEDC in violation of its licensing terms and other operating condition over late submission of its 2013 and non-submission of 2014 audited financial reports.

Both Directives, which were signed by Akah and General Manager, Legal, Licensing and Environment, Olufunke Dinneh, directed the companies to pay their fines within two weeks beginning from December 9, 2016 when the directives were signed.
Commenting on the sanctions Akah, said: “The Commission would do whatever is required to ensure discipline in the Nigerian Electricity Supply Industry (NESI). It is only when stakeholders endeavour to play by the rules that we can begin to reap maximum benefits of the privatisation in the Sector.

“We expect the operators to act in good faith and in line with the industry rules, standards and conditions for their licenses as the Commission will not compromise on international best practices. Customers are also expected to fulfill their obligations to their service providers by paying their bills and not to engage in electricity theft.”

Despite NERC’s sanctions, some of the Discos have continued to behave as the old NEPA and PHCN to extort customers through exorbitant estimated bills.

While some of the Discos are busy providing meters and investing on network expansion to boost their distribution capacity, there is indeed, lack of sincerity on the part of most of the Discos, who have resorted to shortchanging customers to boost their revenue profile.

In his welcome address at the 11th monthly power sector and stakeholders’ meeting, which was co-sponsored by Egbin Power Plc and his company, the Managing Director of Ikeja Electric, Dr. Anthony Youdeowei stated that 2016 was a challenging year for stakeholders, adding that the challenges still remain.
Youdeowei, however, added that they are better discussed whenever stakeholders meet in a bid to address them and proffer solutions.

As the power sector stakeholders meet monthly to discuss the liquidity constraints and other emerging challenges that have hampered efforts to boost electricity supply, the Discos should also ensure that their workers shed the institutional arrogance associated with the old NEPA and PHCN and imbibe the culture of excellent service delivery, which characterises private sector-led businesses.