A Review of the Nigerian Energy Industry

Electricity consumers condemn rising estimated bills

29 September 2014, Lagos – Electricity consumers in the country have raised the alarm over the outrageously high bills being served them by the electricity distribution companies despite the privatisation of the power sector.

The consumers, who expressed their concerns in separate interviews with our correspondents, questioned the rationale behind the sudden spike in their monthly bills, with some claiming that power supply to their areas had not significantly improved to warrant such high bills, while others maintained that the distribution companies had no moral justification for the act.

However, this return of estimated billing is coming after the Federal Government announced that it had reviewed upwards the price of gas from $1.50 to $3.30 per metric cubic feet.

Power-TransmissionxThere are speculations that the Discos are capitalising on the new gas arrangement to exploit unsuspecting electricity consumers.

Investigations by our correspondents revealed that the marketers of the electricity distribution firms, who distribute bills to customers, especially those using analogue meters, attributed the high billing to the rising gas price.

Mrs. Odichi Nwaugo, a resident of Alagbole in Ogun State, who lives in a three-bedroom bungalow, told one of our correspondents that the most recent bill she received showed an increase of about N2,600 over the previous month’s, as it rose from N3,700 to N6,300.

It was also learnt that some officials of the Disco in charge of Ajuwon in Ogun State, were recently confronted by residents when moves were made to disconnect their lines.

The residents, it was learnt, demanded an explanation for the sudden rise in their monthly bills, an action which they described as “wickedness.”

With most electricity consumers without prepaid meters, complaints over arbitrary billing have continued to confront the privatised electricity distribution companies carved out of the now defunct Power Holding Company of Nigeria.

While the power companies were said to be experiencing revenue shortfalls, not a few consumers had complained of being exploited by the distribution companies through estimated billing.

The bill paid by a consumer is made up of the fixed charge and the energy charge. The fixed charge recovers the capital cost and fixed operational cost of poles, cables and transformers, among others, according to the Nigerian Electricity Regulatory Commission.

The energy charge, which is a function of consumption, is paid by consumers only when electricity is consumed and is intended to recover the costs of the power.

Residents of Itire-Ikate community in Ijeshatedo area of Lagos had last weekend protested against estimated billing and improper or non-reading of meters by the Eko Electricity Distribution Company.

The community, which comprises 12 streets, marched to the power firm’s office in the area with a protest letter jointly signed by representatives of the various streets as well as the chairman and secretary of the Itire-Ikate Community Development Association.

Funmi Ogunsola, who lives in a bungalow at Ogba, Ikeja, said she had been paying over N15,000 monthly since the beginning of the year.

“It used to be around N8,000 but recently, the bills we received in our compound had been upwards of N15,000. We have made several complaints, but nothing has been done,” she lamented.

Uche Chukwu, who resides in a three-bedroom flat in Oshodi, complained that he had been paying an average of N11,000 monthly for the past few months, as against N5,000 previously.

“It is very bad that one has to pay that much even when the power supply has not really improved,” he said.

The Chief Executive Officer, Shield Creations Limited, Mr. Caleb Fagade, said, “I use prepaid meter and by virtue of that, I am not experiencing estimated billing. But I believe people who are not using prepaid meters are paying more than what those using prepaid meters are paying.

“When I was using the analogue meter, I was paying about N2,000 in a month on my flat. But when we started using prepaid meter, we spend less than N1,000. I think prepaid meter is the ultimate solution to the issue of overbilling in the name of estimation.”

The spokesperson for the Ikeja Electricity Distribution Company, Mr. Pekun Adeyanju, told one of our correspondents that power had been stable in recent times as the country had been generating above 4,000 megawatts, adding that disruption was only experienced during the recent four-day strike by some workers of the Nigerian National Petroleum Corporation.

“We got increased allocation of power from the grid, which we distributed to Nigerians. This was consumed and should be paid for,” he explained.

The Managing Director, Eko Electricity Distribution Company, Mr. Oladele Amoda, told one of our correspondents in a telephone interview that some of the meters being used by consumers were non-functional and could not be read.

He said, “If the meters are working, of course, they have to be read. But there are some meters that are no more functional. They may be on the customers’ premises, but they are not functional maybe because they are old. Those are the meters that we want to change first.”

“But if customers have any complaints, they should come to us. We are coming with a call centre number by next week, which a customer can call to complain. That is not to say that we don’t have customer care centres.

“Each of our customer care centres has telephone lines that customers can call; but we want to make it central such that we will have one line that customers can call and it will get to the desired destination.”

Amoda said the company had plans to make prepaid meters available to every customer free.

“Every customer will get the meter free, but it will be in phases. We have done our feasibility plan and we will start with the commercial consumers, the high-consuming customers and then we will move to residential customers,” he added.

Amoda further said that a willing customer could get a prepaid meter now by paying for it, adding, “There is a stop-gap arrangement by the electricity regulator. It is just an intervention whereby willing customers who cannot wait for our own metering plan can pay for meters; we will install the meters within 45 days and we will refund the money to the customers.”


– Stanley Opara and ‘Femi Asu, The Punch

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