62.3% electricity consumers still on estimated billing ― NERC
• Says industry recorded ₦119.46bn deficit in Q4 2019
The Nigerian Electricity Regulatory Commission (NERC), on Saturday said 62.3 per cent of electricity consumers in the country were still on estimated billing as at December 2019.
Tribune Online reports that NERC made this known in its Fourth Quarter 2019 Report which was obtained from its website by News Agency of Nigeria (NAN) in Lagos.
The commission said: “Inadequate metering remains a serious challenge in the industry, with only 3,918,322 (37.77 per cent ) of the total customer population of 10,374,597 metered.
“With 62.37 per cent of the end-use customers on estimated billing, huge collection losses due to customer apathy have posed a serious challenge to the viability and sustainability of the industry.”
It said in comparison to the third quarter of 2019, the numbers of registered and metered customers increased by 699,850 (7.23 per cent) and 22,825 (0.59 per cent) respectively.
NERC said the increase in the number of registered customers was attributable to the on-going enumeration exercise by DisCos while the increase in metered customers was due to the roll-out of meters under the Meter Asset Provider (MAP) schemes.
It said: “The commission notes with concern that the additional 22,825 end-use customers’ meters installed during the fourth quarter fell significantly from the 83,768 meters installed during the third quarter.
“This poses risk to the Commission’s goal of closing the metering gap in the Nigerian Electricity Supply Industry (NESI) by December 31, 2021.
“Although some MAPs have not fully commenced meter deployments, the low metering recorded during the quarter was partly due to the increase of 35 per cent in import duty on meter components.
NERC said it was already working with the Ministry of Finance, Budget and National Planning toward addressing those issues in order to fast-track meters roll-out.
It said during the period under review, only Abuja, Eko, Enugu, Ikeja, Kaduna, and Port Harcourt DisCos metered additional customers.
According to NERC, the metering status of the DisCos as at December 2019 is: Benin DisCo, 53.71 per cent; Abuja, 52.39 per cent; Eko, 46.67 per cent; Ikeja, 40.38 per cent and Jos, 31.71 per cent.
Others are: Port Harcourt, 38.34 per cent; Ibadan, 32.21 per cent; Kaduna, 22.2 per cent; Kano, 18.36 per cent; Enugu, 41.26 per cent and Yola, 18.75 per cent.
The commission said it would continue to monitor the DisCos to ensure total compliance with the MAP regulations.
The commission also said the Nigerian Electricity Supply Industry (NESI) recorded N119.46 billion deficit in the fourth quarter of 2019.
NERC said the 11 Electricity Distribution Companies (DisCos) only remitted a total of ₦74.20 billion out of the ₦193.66 billion invoice issued to them for energy received and administrative charges during the period.
NERC said liquidity challenge was still a major issue in NESI in spite of the recent improvement in Aggregate Technical, Commercial and Collection (ATC&C) losses by the 11 Electricity Distribution Companies (DisCos).
“This is evidenced in the DisCos’ international and special customers’ remittances to Nigerian Bulk Electricity Trading Plc (NBET) and Market Operators (MO) during the fourth quarter of 2019.
“During the fourth quarter, DisCos were issued a total invoice of ₦193.66 billion for energy received from NBET and for administrative services by MO.
“However, only a total of ₦74.20 billion (38.32 per cent) of the invoice was settled as and when due, creating a total deficit of ₦119.46 billion including tariff shortfall,” the regulatory agency said.
NERC said Eko DisCo recorded the highest remittance rate (51.50 per cent) in the fourth quarter of 2019 followed by Abuja with 51.27 per cent remittance rate.
It added that although Jos DisCo’ settlement rate improved during the fourth quarter, its remittance rate of 19.57 per cent was the lowest in the fourth quarter of 2019.
NERC also disclosed that total market invoices were issued to the special customer (Ajaokuta Steel Co. Ltd) and the international customers (Societe Nigerienne d’electricite (NIGELEC )and Communaute Electrique du Benin (CEB) during the same period.
According to NERC, N29.50 million was issued to Ajaokuta Steel Company while N2.07 billion was issued to NIGELEC and CEB respectively.
The commission, however, said neither NBET nor MO received payments from these customers during this period.
“Although there has been a significant improvement, the challenge of low remittance to the market is still a concern to the commission as it is one of the main causes of the liquidity crisis facing NESI.
“Low remittance adversely affects the ability of NBET to honour its financial obligations to Electricity Generation Companies (GenCos).
“Also, service providers struggle with the paucity of funds impacting their capacity to perform their statutory obligations,” NERC said.
It, therefore, urged the DisCos to rapidly improve on their revenue collection from customers in order to fulfil their remittance obligations and mitigate financial distress in NESI.
NERC said to enforce payment discipline and compliance with the minimum remittance, it had during the fourth quarter, began enforcement action against DisCos that defaulted in the third quarter billing cycle.
Following the commencement of the enforcement by the Commission, all DisCos except Enugu DisCo have met their expected Minimum Remittance Threshold for the third quarter. (NAN)