10 July 2012, Sweetcrude, Abuja – The Nigerian Electricity Regulatory Commission, NERC, has announced plans to remove all forms of overbilling by electricity distribution companies in a new framework for estimated billing to be released soon.
A statement from the Commission made available to our correspondent in Abuja, noted that “overbilling by electricity distribution companies is set to be eliminated as the framework for estimated billing and connection fees are to be discussed in a public consultation with customers, distribution companies, industry stakeholders and the general public in Abuja.”
NERC customarily holds wider consultations as standard practice as a way of ensuring fairness to both customers and industry operators. “Distribution companies are expected to adhere strictly to the new guidelines that are to be based on consultation with major players and customers in the Nigerian electricity industry. This forum provides the public with an opportunity to be informed on the critical sector issues as well as an avenue to participate in the process of improving the sector,” it stated.
According to the Commission, matters for consultation include the new methodology for estimated billing, which distinguishes customers into three distinct categories, namely – new customers, customers with faulty meters, and customers whose meters cannot be read clearly.
It noted that, “Based on this criterion, these customers will be given estimated bills for a limited period of three months, after which the distribution company is required to provide the customer with a meter to ensure they are only paying for what they consume.
“In the same vein, the connection fee methodology will circumvent the reported practice of the distribution companies charging customers unnecessary and excessive fees for connecting to electricity services. With the new methodology, new and existing customers are no longer required to pay for meters as this cost has been built into the NERC approved electricity tariff.
“Likewise, components for electricity connection will be determined by the customer’s proximity to the nearest electricity service line. The proposed methodology clearly details the connection components which will determine the associated fees payable by the customer, where applicable,” the statement added.
The Chairman of NERC, Dr. Sam Amadi has stated that as a regulator, NERC’s commitment is to regulate the industry in a manner that guarantees sustainable expansion of capacity and improvement of customer service. “We understand that the grave crisis of the sector is caused by the absence of good corporate practices and ineffective regulation for many decades.
“The premise of the Electric Power Sector Reform Act 2005 is the establishment of a new electricity industry that is effectively regulated to provide Nigerians access to adequate, stable and reliable electricity. At this stage of the electricity industry, visible improvement in service delivery is a clear and pressing need,” he added.
The NERC boss noted that on the issue of meters and estimated billing, the Commission has been consistent in stating that under the new tariff structure, the cost of meters has been included in the revenue requirement which is covered by the retail tariff.
“This means no consumer is required to pay additional fees for meters. We also plan to regulate connection fees in line with the requirement of the regulation on consumer protection. We have already completed the methodology for standardizing connection fees. We will be meeting with CEOs of the distribution companies this week to agree on the connection fees for every distribution company,” Amadi added.
The public consultation is scheduled for Wednesday July 11, 2012 in Abuja.