he Nigeria Electricity Regulatory Commission (NERC) has mandated eleven electricity distribution companies (DisCos) to allocate N275 billion for the procurement of electricity meters between 2024 and 2027 in a move aimed at addressing the longstanding menace of estimated billing in the country.
The directive, which affects all discos nationwide in Nigeria, is part of the Multi-Year Tariff Order issued by the NERC.
According to NERC’s guidelines, each DisCo is expected to allocate approximately N6.25 billion annually to secure 65,000 electricity meters.
Collectively, the 11 DisCos are anticipated to lavish N275 billion in furnishing consumers nationwide with meters, to bring an end to the contentious practice of estimated billing, with an ambitious goal of distributing 2.86 million meters during the stipulated period.
The move follows a meticulous review of the metering quotas proposed by distribution companies, which has fallen short of the approved figures. The regulatory intervention seeks to rectify the existing metering disparities across the nation.
Meter Acquisition Fund (MAF): Powering Up the Revolution
NERC has also laid down the law, instructing DisCos to contribute N1.185 per kWh to the Meter Acquisition Fund (MAF). Established to provide sustained financial backing, the MAF is designed to bridge the yawning metering gap prevalent across the country. The centrally managed fund will serve as a bulwark for long-term financing, signaling a pivotal step in the direction of reliable and accountable electricity metering.
Nigeria’s Meter Gap: Bridging the Disparity
Honorable Bayo Adelabu, Nigeria’s Minister of Power, estimates the number of unmetered customers to be between 7 and 8 million nationwide. However, a comprehensive analysis by PwC presents a more alarming scenario, with an estimated 38.91 million unmetered customers. The report suggests that a staggering 50% of Nigeria’s existing meters are either obsolete or faulty, encompassing 1.7 million customers, 4.09 million unmetered, and a potential 33.1 million unconnected customers.
Despite the ambitious targets set by NERC, concerns linger as to whether the five-year program can effectively close the metering gap.
The 2023 Q3 report from NERC reveals a metering rate of 44.51% across all DisCos, with Ikeja DisCo leading at 72.0%, while Yola DisCo lags behind at a mere 18%. Of the 12.82 million customers, a substantial 7.11 million remain unmetered, constituting a worrisome metering gap rate of 55.49% as of September 30, 2023.
World Bank’s Shocking Jolt: $500 Million Program Spurs Controversy
In a bid to enhance meter distribution, the World Bank initiated a $500 million program, allocating $155 million for consumer meters and $345 million to boost DisCos’ electricity supply capabilities. However, the Manufacturers’ Association of Nigeria (MAN) has raised eyebrows, alleging the exclusion of local meter manufacturers in favor of foreign importers. This controversy adds a layer of complexity to the ambitious World Bank initiative.
As the nation grapples with the intricate web of metering challenges, the success of these initiatives hinges on seamless execution, regulatory oversight, and a commitment to ending the era of estimated billing, ensuring a brighter, more electrifying future for all Nigerians.