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Financial Crisis Hits Discos Harder as Only 504,729 Meters Installed, Leaving 7.1 Million Customers Unmetered

Financial Crisis Hits Discos Harder as Only 504,729 Meters Installed, Leaving 7.1 Million Customers Unmetered

The financial crisis in the electricity industry is hitting the Distribution Companies (DISCO) harder, as only a total of 504,729 meters were installed by electricity distribution companies between January and September 2023.The number of power consumers without meters across the country is now 7,117,167.

Data obtained from the latest third quarter report of the Nigerian Electricity Regulatory Commission indicated that as of September 30, 2023, there were 12,825,005 registered electricity customers in Nigeria’s power sector.

The NERC stated that out of this number, only 5,707,838 customers had been metered, which implies that over 7.1 million registered power users across the country lack meters.

A further analysis of the first, second and third quarter reports of the power sector regulator indicated that electricity distribution companies installed a total of 504,729 meters during the nine-month period.

They installed 175,281 meters in the first quarter, deployed 181,059 meters in the second quarter, while this dropped to 148,389 meters in the third quarter. Meter installations are ongoing in this current fourth quarter.

Providing an explanation on metering in its latest third quarter 2023 report, the commission said, “As at September 30, 2023, there were 12,825,005 registered electricity customers in the NESI (Nigeria Electricity Supply Industry) out of which only 5,707,838 (44.51 per cent) are metered.

“Over the course of 2023/Q3, 148,389 end-user customers were metered. Ikeja, Abuja and Ibadan Discos had the highest number of meter installations in 2023/Q3, accounting for 27.35 per cent, 20.78 per cent and 17.53 per cent respectively of the total installations.”

It stated that the 148,389 meters installed in 2023/Q3 represented a decrease of 32,670 installations (-18.04 per cent), when compared to the 181,059 meters installed in 2023/Q2.

“The new installations resulted in a 0.35pp increase in net end-user metering rate in the NESI between 2023/Q2 (44.16 per cent) and 2023/Q3 (44.51 per cent),” the commission stated.

It noted that during the quarter, “147,736 meters were installed under the Meter Asset Provider framework, while 207 meters were installed under the National Mass Metering Programme framework.

The Vendor Financed framework recorded 446 meter installations while no meter installations were recorded under the Disco Financed framework,” the power sector regulator stated.

Operators in the sector have repeatedly blamed the liquidity crisis in the sector for the low deployment of meters and other challenges in the industry.

The Minister of Power, Adebayo Adelabu, had during the recent power sector ministerial retreat in Abuja, admitted that financing was a major challenge in the business of electricity supply in Nigeria.

He disclosed this while speaking on finance, revenue assurance and capital investment programmes across the electricity value chain in Nigeria.

“The heart of NESI’s proposed reforms hinges upon securing long-term financing across the entire value chain.

“While past discussions highlighted concerns about the financial capacities of private sector players from the 2013 privatisation, our focus must centre on collaborative solutions to alleviate present liquidity challenges.

“Initiating this quest for robust investment involves attracting domestic institutional investors and reputable partners from well-governed sectors within the electricity value chain.

“At this retreat, we’ve invited established infrastructure financiers and fintech innovators to infuse fresh thinking into our industry, aiming to develop innovative policies enabling capital investment programmes and fiscal incentives that elevate the risk profile of sector opportunities to financeable levels,” the minister stated.

VON News


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