A Review of the Nigerian Energy Industry

Electricity service charges to go – NERC

6 September 2011, Sweetcrude, Abuja – Chairman, Nigeria Electricity Regulatory Commission (NERC), Dr. Sam Amadi, has announced that the commission will soon remove the current service charges imposed on consumers in the electricity metering system.

Speaking to newsmen at an enlightenment forum for estates developers and residents in Abuja, he said that meter service and maintenance charges were component delivery charges, which are backed by the Power Reform Act of 2005.

Amadi explained that it was in accordance with international best practice that consumers are supposed to pay for meters and transformers but not service and maintenance charges.

While unfolding how the charges would be in the long-run, the chairman said: “In the industry, all meters and transformers are supposed to be paid for by the consumers. The implication is that, for example, if they want meters, each distribution company will bring the bill and we will approve them to embark on the investment. But when they make the investments, they are going to bring a tariff increase; that is the practice all over the world. We are not doing it only here.”

He explained that the task before the Federal Government and the commission is to ensure increased power generation.

According to him, the Minister of Power is intensifying efforts to ensure that demand for power is matched by supply in the next few years.

On the essence of the forum, Amadi stated that there had been series of complaints from tenants of estate developers that the latter were charging them exorbitantly.

He noted that although the developers had licences to distribute and market powers, the law disallowed them from charging above the official tariff. He added that they were not permitted to sell electricity.

“We have got series of complaint from residents of estates, who felt they have been abused. In this industry, estate owners are not permitted to sell electricity,” said Amadi.

The chairman also said: “We expected that even as they distribute it, they don’t charge more than the allowed tariff. So, they install all kinds of meters and over bill residents. You wake up in the morning and ask for N7,000, N10,000 per month.”

Amadi claimed that the residents were worried because they felt they had been abused.
He stated that it was the responsibility of the commission to regulate the power sector and get rid of very arbitrary practice.

He said despite the power bestowed on NERC to discipline any violator, the commission would not wield the big stick until it had enlightened them.

“It is our duty to resolve these conflicts but after educating them, we will go ahead to penalise,” he added.

Without the education, said Amadi, there would be conflicting interests between the power producers and the consumers, and that if the regulatory agency is independent, it would be able to harmonise their differences.

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