…As market deficit drops to ₦151.30 billion
Despite efforts by stakeholders in the Nigerian Power Sector, metering by distribution companies (Discos) reached 672,539 meters, leaving the number of unmetered electricity customers at 7.3 million.
The latest figures, released by the Nigerian Electricity Regulatory Commission (NERC), show that while efforts to reduce the metering gap are ongoing, millions of electricity consumers remain without meters, relying on the controversial estimated billing system.
This development highlights the growing challenge of ensuring accurate billing and efficient power distribution across the country.
The total number of registered electricity customers in Nigeria stands at over 13.16 million, with unmetered customers accounting for a significant portion.
The 11 electricity distribution companies (Discos) have been working to address the metering shortfall through initiatives such as the National Mass Metering Programme (NMMP), which aims to provide prepaid meters to consumers.
However, progress has been slow due to logistical challenges, inadequate funding, and disruptions in the supply chain.
Industry experts have raised concerns that the slow pace of metering could exacerbate billing disputes and customer dissatisfaction. Unmetered customers are often subject to estimated billing, which has led to widespread complaints about inflated electricity costs.
Chantelle Abdul, the group managing director of Mojec International, told BusinessDay that “Deploying meters across Nigeria has several challenges, including logistical issues, regulatory hurdles, and consumer resistance. We have established robust logistics and supply chain networks to navigate these challenges to ensure timely delivery and installation.
Read also: Eko DisCo warns against paying individuals for meters
“We also engage with regulators to streamline approval processes and work on consumer education campaigns to highlight the benefits of metering. Our goal is to ensure that every Nigerian has access to reliable and accurate electricity metering,” she added.
Meanwhile, electricity subsidy dropped to ₦151.30 billion during the year, indicating a 17.7 percent decline from 2022. According to the Commission, this underpayment is known as a “market shortfall”.
The report read: “A Minimum Remittance Obligation (MRO) adjusted invoice of ₦858.03 billion was issued by Nigerian Bulk Electricity Trading plc (NBET) and Market Operator (MO) for energy costs and administrative services to DisCos in 2023.
“The DisCos remitted a total of ₦706.73 billion, resulting in a deficit of ₦151.30 billion during the year. Based on the above, the gross DisCo remittance rate to the upstream segment for 2023 was 82.37 percent.”
The Nigerian federal government is set to pay approximately ₦180.8 billion in electricity subsidies to power consumers in Bands ‘B’ to ‘E’, whose tariffs have remained frozen since December 2022, according to reports from the Federal Capital Territory (FCT).
In addition, NERC has imposed fines totalling ₦8.3 billion on the country’s 11 DisCos for overcharging customers. NERC has also directed the Discos to compensate affected consumers for the improper billing.
These developments were outlined in the September 2024 Supplementary Order of the Multi-Year Tariff Order (MYTO) of 2024, which was issued yesterday in Abuja by the power sector regulator, led by Sanusi Garba.
NERC further mandated the Discos to secure at least 10% of their 2024 electricity load allocation, aimed at enhancing supply reliability and maintaining a minimum service level under the Service-Based Tariff (SBT) framework.
Regarding the subsidy payments, NERC has approved ₦26.4 billion for Abuja consumers, ₦23.76 billion for Ikeja Disco, ₦22.21 billion for Ibadan Disco, ₦19.92 billion for Eko Disco, and ₦14.87 billion for Benin Disco this month.
In the September subsidy cycle, Enugu Distribution Company (Disco) is set to receive N14.61 billion, while Port Harcourt Disco will be allocated N13.45 billion. Kaduna Disco will benefit from N13.14 billion, Kano Disco will receive N12.96 billion, and Jos Disco will be entitled to a subsidy of N11.68 billion. Yola Disco is slated to get N8.06 billion in this round of disbursements.
“In line with the policy direction of the federal government on electricity subsidy, the allowed tariffs for Bands B-E customer categories shall remain frozen at the rates payable since December 2022 subject to further policy direction by the government,” NERC said.
