Estimated Billing Of Electricity Users Is Now Abolished In Nigeria. Daily Law Tips (Tip 516) by Onyekachi Umah, Esq., LLM. ACIArb(UK)
According to the regulator of electricity(Nigerian Electricity Regulatory Commission) about 52% of over 10 million electricity customers population in Nigeria as at 2019 received estimated bills and do not have meters. Note, customers population rose from 5 million in 2012. As expected electricity customers protested and complained to Nigeria Electricity Regulatory Commission (NERC) with over 65% of the complaints received by NERC being on unrealistic estimated bills and failure to provide meters to customers by electricity Distribution Companies. NERC blames decline in market liquidity on customer apathy and customers desire not to fully off-set estimated bills.
However, earlier on in 2012, NERC approved estimated billing of electricity users(customers) without meters. This was allowed by NERC with the understanding that every electricity user will be identified and metered by electricity Distribution Companies (DISCOs). It was approved by NERC through NERC’s Methodology for Estimated Billing Regulations 2012. In most parts of Nigeria, while estimated bills kept coming every monthly, electricity meters never came.
NERC in order to ensure electricity customers are quickly metered introduced programs that allowed DISCOs to engage third parties (Meter Asset Provider) to provide meters in their coverage areas. Meter Asset Provider (MAP) was approved on 8 March 2018 to cover the meter gap in electricity sector by metering all Nigerians with 3 years. Unfortunately, till date, meters are still not available though estimated bills are forced on customers every month. It must be mentioned that in June 2016, NERC stipulated deadline of 30 November 2016 for total metering of all maximum demand customers in Nigeria but later extended same to 1st March 2017. Till date there is huge metering deficit in the sector.
To stabilize the electricity industry and save electricity customers from the often outrageous estimated bills, on 20 February 2020, NERC abolished estimated billing and bills in Nigeria with effect from same 20 February 2020. By “ORDER ON THE CAPPING OF ESTIMATED BILLS IN THE NIGERIAN ELECTRICITY SUPPLY INDUSTRY, 2020” issued by NERC, signed on 20 February 2020, no person in Nigeria is allowed to pay estimated electricity bill as from 20 February 2020. Estimated billing system has been repealed and abolished in Nigeria. The said Order clearly repealed NERC’s (Methodology for Estimated Billing) Regulations 2012.
The said Order from NERC applies and binds all the electricity Distribution Companies in Nigeria. The distribution companies in Nigeria, are; Abuja Electricity Distribution Plc (AEDC), Benin Electricity Distribution Plc (BEDC), Eko Electricity Distribution Plc (EKEDC), Enugu Electricity Distribution Plc (EEDC), Ibadan Electricity Distribution Plc (IBEDC), Ikeja Electricity Distribution Company (IKEDC), Jos Electricity Distribution Plc (JEDC), Kaduna Electricity Distribution Plc (KNEDC), Kano Electricity Distribution Plc (KEDC), Port Harcourt Electricity Distribution Plc (PHEDC) and Yola Electricity Distribution Company Plc (YEDC).
Furthermore, the said order of NERC, mandates DISCOs to identify and meter all electricity users before 30 April 2020. It also set the maximum fee that any unmetered user can be charged in any part of Nigeria, monthly. And, any user that already pays electricity bill that is lower than the maximum rate stated by NERC is also allowed to continue paying such low bill. By the said recent order of NERC, the maximum monthly electricity bill any unmetered user in Nigeria can pay is #200.00 for Residential Customers of Class 1 (lifeline, R1). The Order states varying rates maximum bills depending on location for Residential Customers of Class 2 (R2- single or 3 phase).
On 4 February 2024, the Business Day reported that across Nigeria most electricity customers are still unmetered and the DISCOs are demanding exorbitant electricity bills from unmetered customers. Obviously, the DISCOs are not adhering to the NERC’s “ORDER ON THE CAPPING OF ESTIMATED BILLS IN THE NIGERIAN ELECTRICITY SUPPLY INDUSTRY, 2020”.
In a report by the Guardian Newspaper on 10 February 2024, NERC has found that the 11 DISCOs are engaging in arbitrary billing of unmetered customers. Hence, NERC will “… deduct N10.5 billion from its the accounts of the 11 Distribution Companies (DisCos) operating in the country over arbitrary billing of unmetered customers.” The deduction will be made by NERC to deter the DISCOs from disobeying NERC orders, including the NERC’s “ORDER ON THE CAPPING OF ESTIMATED BILLS IN THE NIGERIAN ELECTRICITY SUPPLY INDUSTRY, 2020”.
Consequently, NERC’s order (NERC/2024/004-014) has ordered DisCos to issue to over-charged unmetered customers a Credit Adjustment, for the period from January to September 2023 by the March 2024 billing cycle. Also, the DISCOs are to publish the list of the beneficiaries of the Credit Adjustment in two national dailies and on websites of the DISCOs on or before 31 March 2024.
References;
1. NERC’s ORDER ON THE CAPPING OF ESTIMATED BILLS IN THE NIGERIAN ELECTRICITY SUPPLY INDUSTRY, 2020. A copy of the said authority from NERC can be downloaded for FREE by clicking this link; NERC+Order+on+Capping+of+Estimated+Bills+in+NESI-24022020 or by visiting the direct website of NERC via the link below: website of NERC on capping of estimated billing.
2. Iniobong Iwok, Seyi John Salau, Sikirat Shehu and Mercy Enoch, “Unmetered Electricity Consumers cry out over Estimated Billing” (Business Day, 4 February 2024) <https://businessday.ng/news/article/unmetered-electricity-consumers-cry-out-over-estimated-billing/?amp=1> accessed 27 March 2024
3. Kingsley Jeremiah, “DISCOs to Pay Consumers 10.5b Over Estimated Billing” (Guardian Newspaper, 10 February 2024) <https://guardian.ng/news/discos-to-pay-consumers-n10-5b-over-estimated-billing/> accessed 27 March 2024.
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Feel free to reach the author, ask questions or make inquiries on this topic or any other legal issues via onyekachi.umah@gmail.com or +2348037665878.
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