NERC orders Discos to abolish bulk metering …

… sets to sanction IKEDC, others over CAPMI compliance 

Sam Amadi

OREDOLA ADEOLA

Following the National Assembly’s resolution of August 11, which rejected the extortion of bills from electricity consumers in the country by the electricity Distribution companies, (Discos), through fixed charges, bulk metering, and similar practices, the Nigerian Electricity Regulatory Commission, NERC, has directed the Discos to restructure their billing system to ensure that electricity consumers pay for only what they consume.

It would be recalled that the resolution followed a motion moved by Senators Sam Egwu (Ebonyi North) and David Umaru (Niger East), titled, “Unfair trade practices of Electricity Distribution Companies in Nigeria.” Consequently, the Senate had directed NERC to immediately abolish fixed charges on electricity consumption and bulk metering of communities, ordering it to ensure that payment are only made for energy consumed.

NERC in a letter obtained by Hallmark which was signed by Dr. Sam Amadi, the NERC chairman, to the Senate, however revealed that it had directed the Discos to stop the bulk metering of consumers, saying it agrees with the National assembly’s resolution that bulk metering should be immediately replaced with individual metering.  The statement reads in parts

“The commission agrees with the Senate’s position on the need to eliminate the practice of bulk billing residential customers and replace the practice with individual metering and billing. It is important to state that the commission had previously abolished bulk billing in its ruling on the VGC Case CASE NO: NERC/H/03/07 (copy attached). This case was brought by a customer against the VGC Estate Management.

”In recognition of the negative impact of the fixed charge, the commission has held several public consultations to ascertain a measure that will guarantee financial viability in the industry and not expose consumers to paying for electricity not consumed. Based on the intervention of the commission, the distribution companies have agreed to find a way to restructure the fixed charge such that a consumer who does not receive electricity supply does not pay the fixed charge.

“This remodeling of the fixed charge will be part of the on-going tariff review process being conducted by the distribution companies. NERC will continue to ensure that whatever model is presented for its approval is fair and reasonable, and ensures the survival of the new electricity market and improves quality of supply to consumers…

“The decision of the commission stipulated that every customer is expected to be metered individually, irrespective of the status of supply coming into the area, and the class of billing should be on R2 or as appropriately determined by Disco.”

The NERC Chairman, however disclosed that the commission had provided a leeway for the application of estimated billing, saying estimation should only be applicable in situations where residential meters are not provided to customers. He said that communities placed on bulk billing arrangement should immediately reject it and demand individual meters.

Meanwhile, the commission revealed that it is in the process of completing public consultation on a proposal to cap the amount an unmetered customer can pay until he or she is metered. It also noted that the proposal will also commit distribution companies to strict deadline for metering of all its customers. It has also abolished connection of new customers without meters by the Discos.

The commission had also revealed plan to ensure the unconditional implementation of the Credited Advance Payment For Metering Implementation (CAPMI) scheme, through enforcement action on the distribution companies (DISCOs) for non-compliance.

According to Usman Arabi , Head, Public Affairs Department NERC, a caveat had earlier been issued to the defaulting utilities – Port Harcourt, Abuja, Yola, Enugu, Ibadan, Ikeja, Eko and Benin distribution companies to either shape up or be penalized.

He said, ” The Commission considers your actions as manifest and flagrant breaches and therefore requires you to show cause in writing within seven days from the date hereon, why enforcement should not be commenced against you and sanctions meted accordingly for non-compliance with the Terms and Conditions of the license granted you and the order on Credited Advance Payment for Metering Implementation.

The order introducing the CAPMI scheme became effective on 14 May, 2013, in which NERC directed that the scheme should commence and be implemented at the same time in all the distribution companies. Furthermore, the discos were to redeploy meters under the scheme to willing customers, including the installation of same within 45days from the date of the payment by any customer.

However, rather than stick to the mandate, the Commission , we reliably gathered,said that the aforementioned distribution companies were extorting money from‎ customers and were found wanting in the area of publicity.

“They also have been found to be collecting money from customers for credit meters not minding whether they opted for the scheme, including not publicising the scheme thus giving misleading information to customers.”

He however warned that the discos will be sanctioned, if the directive is not implemented.