The Federal Government has recently declared a spike in the prices of single-phase and three-phase pre-paid electricity meters, which took effect on the 6th of September, 2023. This information was disseminated in a directive issued by the Nigerian Electricity Regulatory Commission (NERC), bearing the distinctive identifier NERC/2023/020 and co-signed by the Chairman of the commission, Sanusi Garba, and its Commissioner responsible for Legal Affairs, Licencing, and Compliance, Dafe Akpeneye. As outlined in the directive, a single-phase meter now cost N81,975.16 up from the previous price of N58,661.69, while the price of a three-phase meter was raised to N143,836.10 from N109,684.36.
However, power consumers in the nation have opposed the meter price hike and are perplexed as to why the government has persisted in hiking the cost of various commodities in the energy sector. Elaborating on the situation, the NERC has stated that it was implemented with the aim of ensuring equitable and rational pricing of meters for both Meter Asset Provider (MAP) and end-use customers. The increase in fees, as stated, will guarantee the capacity of MAP to recuperate justifiable expenses related to the acquisition and upkeep of meters, while also ensuring that their pricing framework permits a sustainable return on the investment.
Vital macroeconomic variables data from CBN, NBS were considered.
Additionally, it would assess the cost-effectiveness of meter services for consumers, with the goal of avoiding overcharging. The commission noted that this would ensure that MAP capacity to provide meters to end-use consumers notwithstanding the current economic situation. Considering the fact that end-use meters guarantee revenue for the utility and the end-use customers, the commission argued that completing the metering of these consumers was crucial to the financial sustainability of the Nigeria Electricity Supply Industry (NESI). The MAP scheme is one of the four metering provision schemes for end-use consumers outlined in the NESI regulations.
In accordance with Section 8(1)(c) of the regulations, MAP must charge the regulated rates specified by the commission for the cost of single-phase and three-phase meters, as well as any additional costs for installation and warranties. Significant shifts in macroeconomic variables like inflation and foreign exchange rates have prompted the commission to re-evaluate the regulated rates for MAP meters. As stated, the commission also considered vital data from the Central Bank of Nigeria and the National Bureau of Statistics on the substantial shift in macroeconomic variables as criteria for the meter price review.
Authorized meter rates did not include Value Added Tax.
Meanwhile, the NERC-approved regulated pricing for single-phase and three-phase meters for MAP, including all other associated costs like installation and warranties, will be maintained, as stated by the commission. It was clarified that the authorized meter rates did not include Value Added Tax (VAT) but did include the Nigerian Electricity Management Services Agency revised sealing cost. The sealing cost for a single-phase meter was N842.80 per unit and the cost sealing cost for a three-phase meter was N1,100.80 per unit.
As per the statement, “all MAP shall adjust their prices to reflect the approved rates. All MAP shall supply meters previously paid for by end-use customers prior to the commencement of this order at the prevailing rate when payment was made by the customers without additional increase in cost. “All Discos and MAP are to develop/implement customer enlightenment campaigns on the price review along with a schedule on the implementation of their meter rollout plans. All MAP shall continue to file monthly sales and meter installation returns with the commission, the commission stated.
MAP had put pressure on the government to increase the price.
Power consumers, however, urged the government to consider the present predicament of Nigerians and roll back the price hike. Uket Obonga, the National Secretary of the Nigeria Electricity Consumer Advocacy Network, said the government has mulled over the increase since the unification of the foreign exchange rates, but was advised against it due to the hardships Nigerians are facing. He explained that MAP had put pressure on the government to increase the price, as some threatened to stop providing meters if the equipment cost did not change. Obonga noted that, in addition to the strains of PMS price hikes, people are also suffering from price hikes on numerous energy products.
Related Link
NERC: Website
