PHCN CEOs responsible for inefficiency in power sector – Panel

31 May 2012, Sweetcrude, ABUJA – A committee set up to look into metering and electricity supply in Nigeria has faulted chief executive officers of Power Holding Company of Nigeria (PHCN) for the “inefficiency and lack of accountability in the sector.”

The committee was set up by the Nigerian Electricity Regulatory Commission (NERC) in December, 2011.

Presenting the committee’s report to NERC in Abuja, the chairman, Mr Bamidele Aturu, said: “The committee discovered that less than 50 per cent of the registered customers in the Nigerian electricity sector are metered.

“And this has led to the prevalent practice of arbitrary charges based on unscientific estimation of electricity consumed by customers.

“Distribution companies responsible for distributing electricity to consumers in order to meet up with their overhead costs in an environment of inefficiency and dwindling supply of electricity, have to use estimation to ensure they make more profits.’’

Aturu said that customers captured in the records of electricity suppliers was 5,172,979 which represented 18.7 per cent of the nation’s total households of 28,900,492 by 2006 National Bureau of Statistics report.

According to him, this record does not include those who use electricity illegally who are not registered by distribution companies known as illegal consumers.

He explained that out of the number of customers registered, 2,893,701 or 56 per cent of the population was metered while 2,355,045 or 46 per cent were unmetered.

However, Aturu said that out of the total number of customers metered, about 701,385 or 22 per cent had faulty meters.

Aturu said that the distribution companies told the committee that they were being hampered by inadequate funding to make meters available to customers.

He, however, said that the committee observed in its inquiry that the distribution companies had meters in stock but failed to install them for customers.

Aturu said that the N2. 9 billion provided for Multi Year Tariff Order 1(MYTO)) was released to distribution companies to provide meters to customers, but that they did not adequately account for it.

He listed lack of autonomy, government interference, and absence of competent local meter manufacturers as critical factors which contributed to huge metering gap in the country.

Aturu further accused the distribution companies of sharp practices and inefficiencies in the metering system.

He said that the committee recommended that distribution companies should be given operational and financial authority to engage in innovative strategies of financing aimed at bridging the metering gap.

Aturu said the committee also recommended the creation of N50 billion fund to close the metering gap.

He said that the committee recommended that criminal cases such as illegal distribution should be investigated while those found guilty should be punished.

Dr Sam Amadi, the Chairman of NERC, expressed satisfaction with the committee’s report, saying the recommendation would be implemented to the letter.

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