… blame it on rise in foreign exchange rate
Electricity distribution companies (Discos) in Nigeria have only performed about 10 percent of their total commitment to metering their customers in the country in the fiscal year 2016.
According to a document made available to BusinessDay, the 11 electricity distribution companies made commitment of metering about 1,640,411 customers but only 161,640 customers have so far been metered between January and October 2016.
The Discos have blamed their inability to make substantial progress as regards metering their customers to high foreign exchange rate. They say as of the time they negotiated with government agencies over the number of customers to be metered in a year, the foreign exchange rate was N199 to $1, saying as of today it is N305 to $1.
A breakdown of this figure shows that Abuja Disco, which promised the Bureau for Public Enterprise (BPE) to meter 96,000 customers this year has only succeeded in metering 23,000. Enugu promised 264,000 but only able to meter 1,400.
Anthony Youdeowei, CEO, Ikeja Electric, said metering of all consumers under the zone was not easy to do because of increase in foreign exchange, saying the rules of the game had changed because of the challenges we were facing now as country.
“The lack of foreign exchange is affecting all and sundry. The single phase meter that we are buying for N40,000 is now more than N100,000 while the money is not coming from consumers.
“Presently, we have metered all trading points and most of the companies in the zone,” he said.
He said the company was facing financial challenges because the present tariff for electricity is not cost reflective, noting, “It is a tough business environment because we cannot dictate the price because we are being regulated by Nigerian Electricity Regulatory Commission (NERC).”
Eko Disco also attributed the delivery of only 187,000 meters out of the 600,000 it planned to its customers to scarcity of foreign exchange and a weak naira, which has driven the cost of prepaid meters through the roof.
After making a commitment for 187,000, Eko Disco successfully installed 67,000 prepaid meters within three years of operations, Oladele Amoda, managing director of the company, said.
“We have made commitments for more than 187,000 meters, which are been delivered and so far 67,000 have been installed and we are still installing as at today, he said.
“But the foreign exchange problem in the country is limiting how much we can do in this regard. There has been over 50 percent increase in the cost of meters because of the weak naira.
“The company said it has expended close N5 billion so far and for the entire meter rollout plan, it is going to cost us N52 billion but we will be doing it gradually,” Amoda said.
Kaduna Disco has installed only a paltry 1,207 out of the 48,000 expected of it.
Benin and Port Harcourt delivered 20,244 and 11,695 meters, respectively, when they had a commitment to deliver 100,000 and 187,200 meters in the agreement with BPE.
Ibadan Disco performed appreciably better, delivering 50,730 meters but still did not meet the 100,000 it promised to deliver this year.
Yola and Ikeja Discos delivered 2,525 and 27,286, respectively, out of the 51,600 and 252,000, respectively, they were obligated to distribute to customers this year. Jos Disco did not make any submission at the meeting.
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