CEM Report, Energy | Nigeria’s power sector is facing a significant challenge: a vast metering gap that leaves millions of consumers reliant on estimated billing. This often leads to disputes and frustrations, as customers are charged for electricity they may not have actually used. In an effort to address this issue, state governments have proposed a bold solution – a “no-meter, no-service” policy for all new electricity connections.
This policy aims to incentivize faster meter deployment and bridge the gap between the number of electricity consumers and the availability of meters.
According to a 2023 report by the Nigerian Electricity Regulatory Commission (NERC), over half of all electricity customers in the country are not metered. This translates to millions of Nigerians facing estimated bills, which can be inaccurate and unfair, especially in the context of Nigeria’s often unreliable power supply.
The lack of meters not only creates billing disputes but also hinders the development of a viable electricity market. Without accurate data on consumption, it’s difficult for distribution companies to plan effectively and invest in infrastructure upgrades.
States Advocate for “No-Meter, No-Service” Policy
In a recent document presented to the Federal Ministry of Power, the Nigeria Governors’ Forum (NGF) called for a national policy that mandates “no-meter, no-service” for all new electricity connections. This policy aims to tackle the metering gap head-on by ensuring that new customers are equipped with meters before receiving electricity service.
“States believe that the provision of electricity meters to close the huge metering gap is a necessary requirement to make sub-national markets viable,” the document states. Governor Aminu Tambuwal of Sokoto State, who chairs the NGF, further emphasized the importance of accurate billing, stating, “We believe estimated billing is not only unfair to consumers but also hinders transparency and accountability in the sector.”
Bridging The Metering Gap
While the “no-meter, no-service” policy is a step in the right direction, it needs to be accompanied by solutions to address the challenges of financing and implementing large-scale metering projects. The NGF document proposes a multi-pronged approach:
Low-Cost Funding: The document suggests that the Federal Government should facilitate access to low-cost, long-term funding for metering schemes. This could involve direct loans to distribution companies or establishing special purpose meter finance companies.
Customer Participation: The NGF also proposes encouraging electricity consumers to participate in the solution by allowing them to purchase prepaid meters directly from accredited vendors. This would help to share the financial burden and potentially accelerate the metering process.
State Autonomy in Metering Technology: Recognizing the diverse needs of different regions, the NGF recommends that State Electricity Regulatory Commissions (SERCs) should have the authority to choose the most suitable meter technology for their respective markets. This flexibility could allow states to consider factors like cost, telecommunications infrastructure, and consumer preferences when selecting meters.
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If You Ask Me
Implementing a “no-meter, no-service” policy and closing the metering gap will not be without its challenges. Concerns have been raised about the potential impact on low-income communities who may struggle to afford the upfront cost of meters. Additionally, ensuring the smooth implementation of the policy across all states will require effective collaboration between federal and state governments, as well as the distribution companies.
However, the potential benefits of a well-implemented metering program are significant. Accurate billing, improved transparency, and a more efficient electricity market could pave the way for a more sustainable and customer-centric power sector in Nigeria.
