- The Nigerian government announced an immediate electricity tariff hike for Band ‘A’ customers, prompting widespread public outcry and protests.
- Nigeria’s power sector struggles with insufficient generation capacity, inadequate distribution, market liquidity issues, vandalism, energy theft, and estimated billing problems.
- Proposed solutions include a mass metering program, remote installation certification, and a structured vendor payment framework. DisCos must enhance customer service, install statistical meters on public transformers, and optimise network delivery.
On Friday, May 17, 2024, the Electricity Hub hosted a Twitter Space on the topic: “Improving Metering with Tariff Hike.” The Twitter Space featured Mr Adeniyi Adekunle Rilwan, the former Head of Metering at the Port Harcourt Distribution Company and current Commercial Group Head for the Southwest region at Holley Metering.
The Twitter Space held for an hour and reviewed Nigeria’s recent electricity tariff increment, its implications for metering, and the need to close metering gaps. During the discussion with Mr Rilwan, he highlighted the following:
Background on Tariff Increase
A few weeks ago, the Nigerian Federal Government announced an immediate upward revision of electricity tariffs through the Nigerian Electricity Regulatory Commission (NERC). Unlike previous adjustments, this increment took effect without a prior start date and targeted customers on the Band ‘A’ supply system. There are indications that tariffs on other bands may also be increased following a review.
Public Response
The announcement prompted widespread public outcry and a nationwide protest by the Nigerian Labour Congress (NLC), demanding the abolition of the band-class tariff system. Despite the socio-political challenges this has created, the new tariff is here to stay. It’s essential to focus on addressing the inherent issues in the Nigerian power sector and finding practical solutions to improve service delivery.
Current Challenges in the Power Sector
The Nigerian power sector faces significant challenges:
- Insufficient Generation Capacity: With a population of about 200 million, Nigeria generates only 4000-5000MW of electricity, far below the required 10,000MW.
- Inadequate Distribution Network: Even if generation meets demand, the distribution network cannot convey electricity to end-users effectively.
- Market Liquidity: There is a lack of liquidity to sustain effective generation, transmission, and distribution.
- Vandalism and Energy Theft: Vandalism of electrical equipment and energy theft are major issues.
- Metering and Billing: The problem of estimated billing needs urgent resolution through effective metering.
Proposed Solutions
A multi-faceted approach involving the Federal Government, local distribution companies (DisCos), and customers is necessary to address these challenges.
Government Intervention
Mass Metering Program: The Federal Government should implement a mass metering program for all customers in Band ‘A’. This could involve loans to DisCos or other financing mechanisms. Ensuring all meters are smart and data is uploaded to a central server can enhance transparency and accountability.
Remote Installation Certification: DisCos, with government support, should implement remote installation certification to ensure standardised and compliant meter installations. This can reduce diversions, improve installation standards, and facilitate quick fault resolution.
Vendor Payment Framework: A structured payment framework for vendors based on installation and certification standards can ensure quality and accountability. For instance, vendors should receive payments in stages based on the successful installation and certification of meters.
DisCo Responsibilities
Improving Customer Service: DisCos need to enhance their customer service to address complaints promptly and ensure customer satisfaction. Effective communication and quick response to issues can reduce energy theft and illegal tampering with meters.
Metering Public Transformers: Installing statistical meters on public transformers, especially those on Band ‘A’ feeders, can help identify and reduce technical losses. This can improve billing accuracy and energy forecasting.
Optimising Network Delivery: DisCos must optimise their network to ensure transformers are not overloaded and deliver electricity within the required parameters. Using statistical meters to monitor transformer performance can help maintain network integrity.
Customer Responsibilities
Judicious Electricity Use: To manage costs, customers must adopt conscious energy consumption habits. Switching off unused electrical devices can significantly reduce energy bills.
Avoiding Energy Theft: Customers should avoid tampering with meters and report illegal activities. Cooperation with DisCos and adherence to the metering process can enhance service delivery and accountability.
Awareness and Engagement
NERC’s Role: NERC must enhance awareness and communication platforms to keep customers informed about power supply and tariff issues. Regular updates on social media and town hall meetings can facilitate better understanding and collaboration among stakeholders.
In conclusion, Mr Rilwan said that addressing the challenges in the Nigerian power sector requires a collaborative effort between the government, DisCos, and customers. The sector can improve significantly by implementing effective metering, improving customer service, and enhancing transparency. Stakeholders must collaborate to create a sustainable and efficient electricity supply system that benefits all parties.
You can listen to the Twitter Space recording here.