Consumers React as Discos Meter Price Rises by 28%

Consumers React as Discos Meter Price Rises by 28%

Power distribution companies in Nigeria have announced an increase in the price for various electricity meter models, marking the second price hike in four months.

Power consumers kicked against the development, describing it as “wicked”, considering the economic hardship nationwide currently.

According to the Discos, the cost of a single-phase meter has risen from approximately N117,000 to as much as N149,800.

This amount indicates an increase of 28.03 per cent or N32,800, depending on the distribution company and meter vendor.

The new prices posted on the official X handle of the Discos on Wednesday were scheduled to take effect on Tuesday, November 5, 2024.

It also reflects the deregulation of meter asset providers as directed by the Nigerian Electricity Regulatory Commission.

This upward revision follows an earlier increase in August 2024, further amplifying concerns among electricity consumers about affordability and accessibility.

An analysis of the documents revealed that meter prices vary across Discos, influenced by vendors and meter models (single-phase and three-phase).

Eko Disco pegged the price of its single-phase meter between N135,987.5 and N161,035, while a three-phase meter was pegged between N226,600 and N266,600.

Ibadan Disco said customers will pay between N130,998 and N142,548 for a single-phase meter and N226,556.25–NN232,008 for a three-phase-meter.

Customers under Abuja Disco will pay N123,130.53 – NN147,812.5 for single-phase meters and N206,345.65 – NN236,500 for three-phase meters.

Kano Electricity Distribution said its customers will pay N127,925–N129,999 for a single-phase meter and N223,793–NN235,425 for a three-phase meter.

Lastly, Kaduna Disco said N131,150 — N142,548.94 would be paid for single-phase meters and N220,375 — N232,008.04 for three-phase meters.

In April, the Nigerian Electricity Regulatory Commission introduced a significant policy shift by announcing the deregulation of meter prices under the Meter Asset Provider scheme for end-user customers.

The move was to address lingering issues surrounding meter supply and pricing transparency within the electricity sector.

According to NERC’s order, meter prices under the MAP scheme will now be determined through competitive bidding rather than being centralised.

This shift is expected to foster greater competition among meter providers, ultimately improving cost efficiency and service delivery for end users.

Additionally, the deregulation removes earlier operational restrictions, allowing MAP permit holders to provide metering services across all electricity distribution companies in Nigeria.

However, MAPs must meet specific regulatory requirements to ensure compliance and maintain quality standards in service delivery.

Previously, NERC regulated meter prices, which were often subsidised across all DisCos to reduce costs for customers. While this model aimed to make metering affordable, it inadvertently stifled competition and limited transparency in the supply chain.

As a result, Discos and customers were unable to negotiate or explore better deals from meter vendors, contributing to inefficiencies in the system.

With deregulation now in place, NERC anticipates a more dynamic metering ecosystem where customers and Discos can benefit from competitive pricing, improved service quality, and greater accountability among meter providers.

Meters are sold directly by the meter asset providers but the application will be done through Discos’ portals.

Some of the meter vendors are Mojec Asset Management Company, Wellsun Intelligent Technology, Gosslink Engineering, Turbo Energy Ltd, MBH Power, CIG Metering Assets, among others.

The meter asset providers had protested that the price approved by NERC was below the landing or production cost of the meters.

For days, meter application portals of the Discos were shut as the vendors refused to supply the product at a rate below its cost.

The Chief Executive Officer of Fermadec Group, Fola Akinola, had told one of our correspondents in April that the Discos shut down their meter application portals because the manufacturers and the Discos were regularising the prices of meters to reflect the current economic realities.

Akinola noted that the meter prices then were no longer sustainable, considering the exchange rate.

He said the NERC needed to stop fixing the prices of prepaid meters because the exchange rate was not stable.

“Before, the price used to be fixed, but now, each seller is going to give his or her price, depending on the type of meter,” he said.

After weeks of negotiation, the regulator approved an increase in meter prices to reflect the current reality in the foreign exchange market.

While announcing the new prices in May, the Discos disclosed that a customer would have his meter installed within 10 working days. However, reports from customers indicated that some of the vendors are not abiding by the rules.

It was also said the prices would be reviewed monthly after a competitive bid process by the vendors.

Consumers kick

The Executive Director of the Electricity Consumers Protection and Advocacy Centre, Princewill Okorie, rejected the new meter prices, saying there are no justifications for it.

He emphasised that the Discos were given N59bn from the N200bn earmarked for the National Mass Metering Programme in 2020, saying they only paid back N7bn.

“What do you want me to say? They keep increasing the meter price, why are they wicked? N200bn was earmarked for the NMMP that was to be implemented in three phases. Only the pilot phase of N59bn was implemented. And what the 11 Discos could pay back was only N7bn. What did they use the rest of the money for?

“Since after that N59bn, what has happened to the rest of the money when you removed N59bn from N200bn? Are they not the same people who are paying for this meter that are paying for the shortfall as part of their electricity bills? The regulator increased the tariff, saying they wanted the Discos to get money to pay back the loan. Who are the people that got the meters?

“Let them stop taking Nigerians as fools. The meter acquisition fund, what did they use it for? So, it’s not justified at all. I don’t know why they want to keep inflicting punishment on Nigerian consumers. Let them account for the N200bn for the national mass metering programme,” he said.

Okorie argued that “in other countries, how much is a meter? What is the price of a one-phase meter or three-phase compared to what they are asking Nigerians to pay?”

When told that the exchange rate was blamed for the meter price hike, he replied, “The N200bn, where is it? Is it the exchange rate that made the Discos not pay back the N59bn loan? Between 2020 and 2024, they were only able to pay N7bn. Why are consumers paying for meters when there is a meter acquisition fund?”