A good cap – The Nation

  • Electricity consumers have cause to cheer as NERC caps estimated billing

For electricity consumers who have suffered outrageous bills, otherwise called ‘crazy bills,’ for so long, respite seems on the way. The Nigerian Electricity Regulatory Commission (NERC), the regulatory body for the sector, is working towards capping the estimated billing system and fast-tracking the metering of electricity customers. NERC’s general manager, finance and management services, Abdulkadir Shettima, disclosed this to The Nation  on the sidelines of the launch of bank consumer and retail financing scheme of Meter Asset Providers (MAP) meter acquisition summit in Lagos, last week. The summit was organised by Mojec Meter Asset Management Company, one of the Meter Asset Providers (MAPs).

According to Shettima, “We are very serious in ensuring all customers are metered at a maximum of within three years and the metering starts from May, this year. Because we don’t want the MAPs or the distribution companies to relax and take this project as any other rule or regulation that they will try to circumvent, we came up with several ways to make sure they comply.”

We agree with NERC that all electricity customers cannot be metered at the same time; hence the need  to incentivise the electricity distribution companies (DisCos) to meter their customers by putting a cap on what they can bill consumers. It would appear that the commission has done some homework to ensure the workability of the new scheme.

One of the proofs of such is the posting of a cash-backed performance bond by the MAP operators who are to pay 2.5 per cent of the total cost of the entire meters’ performance bond to commit them to provide meters within 10 days of receiving evidence of customers’ payment. This can be called upon when the MAPs default in meeting their obligation. The second proof that NERC means well is perhaps what would gladden the hearts of many Nigerian electricity consumers – the capping of estimated bills. What this intends to achieve is to curb the arbitrary manner in which electricity bills are prepared by the DisCos.

Shettima shed more light on this: “There will be a cap; if a distribution company feels that cap is too low and it is losing money, it is incentivised to go and meter that customer. Assuming the cap is N4,000 and the DisCo feels if that customer is metered it can collect N10,000, let it quickly go and meter that customer if it believes the customer’s consumption is up to that.” This must be sweet music in the ears of many electricity consumers. If anything, crazy bill is perhaps the most common complaint of the consumers. The present order weighs more in favour of the DisCos that use rule of the thumb to prepare bills that are subjects of disputes between them and many of their customers.

We commend NERC for this initiative. If well implemented, it would go a long way in improving the electricity supply chain. At least the DisCos that are so reluctant to accelerate metering of consumers would have no choice than to facilitate same when they realise that they cannot make unearned income that they have been making through crazy bills. It will also allow consumers to pay only for electricity consumed, which is the standard practice all over the world.

As we look forward to the take-off of MAP next month, NERC should be reminded that faithful implementation of the new order is crucial. Like many other government policies, the capping idea looks good on paper, but the meat is in how well it is implemented, especially in dealing with electricity distribution companies that are so steeped in their past ways and are deaf to the calls of the present. A situation where electricity consumers requiring meters have increased from 4.7 million in December 2017 to five million is indication that the metering process by the DisCos is rather too slow and deliberately so. So, something drastic has to be done to make them conform to global best practice in billing electricity consumers.

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