NMMP: Stakeholders back CBN’s intervention plan

Stakeholders in Nigeria’s Electricity Supply Industry have backed the Central Bank of Nigeria’s (CBN) metering intervention aimed at bridging the existing deficit.

This was even as the Nigerian Electricity Regulatory Commission (NERC) disclosed that distribution companies (DisCos) in the 2021 fourth quarter, installed 81,084 meters.

The Commission stated that the figure represents a 71.86 per cent reduction when compared to the 288,1549 meters installed in 2021/Q3.

However, it attributed the major reduction to the winding down of the National Mass Metering Programme (NMMP) which had been the key driver of the significant progress recorded in consumer metering all through 2021.

The CBN had, in a bid to close the metering gap, launched a N120 billion National Mass Metering Programme where about 6 million meters are expected to be given to consumers on the account of the distribution companies.

Although the National Bureau of Statistics (NBS) had earlier in its report, confirmed an improvement in the number of metered electricity consumers by 6.8 per cent in five years, millions of electricity users in the country are still subjected to estimated billing.

While challenges, especially allegations over corruption by some DisCos have slowed down the process with only about 900,000 meters given so far, stakeholders have asked the CBN to overhaul the scheme in a manner that will halt importation of meter and focus on local manufacturing of the assets so as to drive economy growth and employment in the country.

President, Nigeria Consumer Protection Network & Member National Technical Investigative Panel on Power System Collapses, Kunle Olubiyo insisted that the CBN intervention would perform better with local manufacturing of meters.

Olubiyo also expressed worries over the cost of meters as well as the tendencies of some distribution companies to shortchanged consumers by engaging in sharp practices.

“Privatisation is still in its infancy. All over the world there are fiscal and non-fiscal incentives, like metering intervention by CBN. CBN can provide sovereign guarantee. CBN should encourage ingenious manufacturers of meters, not importers,” Olubiyo said.

PricewaterhouseCoopers’s Partner, Energy, Utilities, and Resources, Habeeb Jaiyeola, said the interventions of CBN in addressing the gap remained relevant, adding that such a move is normal across the world.

Jaiyeola noted that the CBN intervention remained a welcomed development to facilitate investment and ensure that the electricity market thrives.

According to him, while such fund remains a loan with a set payback period, its application has to be strictly monitored to ensure project objectives are achieved.

On his part, a Public-private partnership consultant,Joseph Tsavsar who participated in the sector’s privatisation process, said metering of customers became an issue due to the liquidity crisis DisCos are faced with.

According to him, the liquidity crisis is due to non-cost recovery tariffs and the generation capacity that is transmitted to the Discos against what was provided in the privatisation agreement.

He described the CBN’s intervention as an afterthought as this was not anticipated in the privatisation agreement.

Tsavsar said the intervention is commercial and increases the financial burden on the DisCos balance sheets.

Also, Adetayo Adegbemle, Power sector analyst noted the need to ascertain the accurate number of consumers connected to the national grid, and their demography, stressing “without this, any intervention policy will always be short.”

According to him, CBN could provide funds for Local Meter Manufacturers and for development of a metering ecosystem, aimed at resolving Nigeria’s metering problems, but should also be independent of the Discos.

Adegbemle expressed concerns over the delays in kick starting the second phase of the NMMP, stressing “If we have used two years to implement Phase zero already, which is barely a million meters, how long will it take to implement the remaining five million?”

He alleged that serious efforts went into silencing the published allegations of diversion of money meant for metering given to the MAPs, noting that “This is definitely casting an ominous shadow on Phase one of NMMP.”

Suggesting a more sustainable leeway for the metering gap, Adegbemle said: “License the independent metering providers (IMSPs), let NEMSA test and approves all meters, and let consumers be able to get their meters off the shelves, remove the metering components in the tariff, and pass a regulation that outlaw power connection without meter.

“You will be surprised at the rate at which the metering gap will be closed. Another advantage is that we will be able to have third party data to collaborate policies.”

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