Wanted! Lifeline for a near-comatose power sector
The Nigerian Electricity Regulatory Commission (NERC) first announced the revised tariff on December 31, 2019. It was to take effect on April 1, 2020, but was jettisoned by the regulatory agency on March 31, 2020, following pressure from organised Labour and other concerned Nigerians. The same fate has again befallen the proposed tariff with its implementation now shifted to the first quarter of 2021.
The proposed tariff would have led to between 60 and 78 per cent rise in consumers’ bills depending on the location and the electricity Distribution Company (DisCo) serving the area.
For instance, residential consumers categorised as R2, in Ikeja, Lagos State who are currently paying about N13.34 per kilowatt-hour (kWh) under the 2015 Multi-Year Tariff Order (MYTO) would have seen about 59.7 per cent increase in their bills. Similarly, their counterparts in Enugu, who have been paying about N17.42 per kWh since 2015 would have paid about N30.93 kWh, about 77.6 per cent hike while consumers in Abuja and environs who have been paying N27.20 per kWh since 2015, would have paid N47.09 per kWh, over 73 per cent increase.
Except consumers in the Residential (R1) category, who would have continued to pay N4 per kWh, all other categories of consumers – commercial, industrial and special – would have paid higher tariffs.
Under the MYTO, R1 are those categorised as poor under the lifeline group consuming about 50 kWh or less. The R2 consumers are those residing in houses, flats or multi-storeyed buildings and using single or three-phase metres. R3 consumers are those who reside in houses, flats or multi-storeyed buildings, but use low voltage maximum demand load, while their R4 counterparts use high voltage maximum demand load (11/33kV).
The Distribution Companies (DisCos) had vigorously campaigned for the take-off of the new order. Yes, it would have meant more money for them. But they also claimed that it was the surest way for them to upgrade their facilities, increase supplies and give electricity consumers in the country value for their money.
“The tariff review is to reflect macroeconomic indices in Nigeria and the global harsh economic realities facing the power sector.
With this tariff, the company amongst other things will be in a better position to roll out more meters, upgrade ageing infrastructure and be more responsive to the complaints of customers. We appeal for the understanding and cooperation of our esteemed customers as we are poised to serve you better,” Chief Operating Officer (COO) of Ibadan Electricity Distribution Company (IBEDC), Mr. John Ayodele, had explained in a statement.
Also, the Ikeja Electricity Distribution Company (IKEDC) had explained that “the plan is for the sector to gradually make a transition to a full cost-recovery market where the cost of services provided will be fully recovered. Services are also expected to improve within a very short time in customer service delivery, infrastructural upgrade, metering and technological solutions based on the level of investments that will be attracted, going forward.”
Nigerians were not convinced by those explanations, hence the antagonism that ensued, which prompted the intervention of the leadership of the National Assembly.
President of the Senate, Ahmad Lawan, and Speaker of the House of Representatives, Femi Gbajabiamila, who worked hard to ensure that the implementation of the proposed tariff was put on hold, with meetings held with the DisCos, NERC and the Presidency before arriving at a truce, hinged their intervention on the need to ameliorate the sufferings of Nigerians amid the ravaging COVID-19 pandemic.
Nigerians were delighted with the outcome of their efforts. However, findings showed that they didn’t oppose the implementation of the new tariff because of the hardship thrust upon them by the pandemic but because of the abnormalities in the operations of the DisCos. As such, they want far-reaching reforms in the sector before being asked to pay more failure which their opposition to tariff increment might persist. The following reports from across the country aggregate their views.
IKEDC, EKEDC Customers Insist On Prepaid Metres Before Tariff Hike
By Ijeoma Thomas-Odia, Maria Diamond and Onyinye Ezeilo
“ASKING whether electricity consumers want increased tariff or not in this country does not count, because from experience DisCos play god on consumers and the government allows them. So, the opinion of consumers does not really matter, as they will still go-ahead to increase the tariff by hook or crook.”
Those were the words of Michael Adekoya, a lawyer who resides in Ilamoshe Estate, Oke-Afa, Lagos, under Ikeja Electric Distribution Company (IKEDC).
Adekoya, who expressed bitterness at the DisCos’ bid to increase electricity tariff, told The Guardian that the country’s biggest problem was electricity distribution.
He said: “In my opinion, this shortfall narrows down to the series of incompetent distribution companies we have had in Nigeria especially the current ones in charge of distributing electricity in Lagos State.
“The only thing IKEDC knows how to do better than withholding electricity every now and then for no reason is extorting money from consumers by all means possible.
“The IKEDC is a fraud! The DisCo is the worst of all the distributing companies. One would expect that a new distribution company would do better than the previous one, but that has not been the case.”
Adekoya added: “The fact is IKEDC officials are not exactly keen about constant electricity distribution to consumers, neither are they enthusiastic about consumers paying electricity bill in time. They are rather more interested in how much bribe they can collect from consumers who do not pay their estimated bills before they come for disconnection. This is why they keep hoarding prepaid metres that should be installed to consumers free of charge. They don’t really want consumers to switch to prepaid metres, as they would no longer have any reason whatsoever to extort money from consumers who haven’t paid their bills. After all, it is a pay as you go.”
For Olufemi Odeyemi, nothing has changed with the coming of the DisCos. “They inherited everything from PHCN, including their mode of operation. They are insensitive to the plights of the people. They bill you just like the PHCN and expect you to pay for their errors. Their estimated bills in Abesan Housing Estate, Ipaja, are killing and we can’t wait to have prepaid metres,” he said.
Odeyemi said the proposed tariff increase might be welcome considering the fact the DisCos are in business to make a profit but said there must be an appropriate billing system before being implemented. “They should bill people for what they consume. That is the only way the increase can be justified. If they continue issuing estimated bills with the new tariff, people will curse them. So, the solution is to give people prepaid metres and let them pay for what they use,” he said.
Speaking on his experiences with the DisCo serving his area, Mr. Francis Denedo, said: “For me, it makes no sense to increase electricity tariff when the majority of homes across the country don’t have light. I personally would not mind paying extra if I have a prepaid metre and the assurance that power supply would be stable. So, for now, I don’t agree with any increment.”
According to Adaeze Nwabueze, a resident of Papa Ajao in Mushin Local Government Area said, “the increment in tariff will be a problem because we pay for what we don’t use. Had it been the amount of light given to us tallies with the bill we receive monthly, we would not care much if they increase the tariff as long as it is fair.”
Also speaking on the issue, Adekola Abbey said: “This country is a joke. Why would the DisCos want to increase electricity tariff? In my house, we have light for only six hours a day and they expect me to pay for something I didn’t use. I stopped paying my electricity bill for the past two months and I have no plans to pay until I see a positive change in the power supply. I would rather continue buying fuel and servicing my generator until further notice.”
EEDC Exploiting Us With Estimated Bills, Say Imo Residents
From Charles Ogugbuaja, Owerri
Electricity consumers in Imo State are unhappy with both the services and billing pattern of the Enugu Electricity Distribution Company (EEDC).
Power supply in the state has been abysmal. This had often forced consumers to fight officials of the company who were either on a mission to distribute bills or disconnect customers who couldn’t pay their bills as and when due.
Many residents who spoke with The Guardian alleged that the EEDC was exploiting them through estimated bills.
Caleb Obinna Amanaka, a graduate of Accountancy, who owns a shop on Christ Church Road, Owerri, said the EEDC bills him about N14, 000 in a month. He lamented that there were times when the area did not enjoy power supply for an average of two hours in a day in a month yet he received the outrageous bill.
“For me, the DisCo we have in Imo State, EEDC, has offered no better service. I will prefer that we allow the Federal Government to run this service. The government has the wherewithal to improve power supply at subsidised rates. Look at what they are doing to us. Sometimes they bring estimated bills of N14, 000 or N15, 000 per month. This is an unjustifiable charge for a one-room shop like this. We cannot continue functioning this way,” he said.
Speaking in the same vein, Mr. Alex Manu questioned the justification for the push for tariff increment by the DisCos, saying the services of the EEDC were very poor.
“We do not want any hike now. Let us first have improved power supply before they talk about that. This is not the right time,” he said.
For Geofery Chijioke Okubi, an artisan who resides in Okwukwu, in Owerri West Local Government Area, the plan to hike electricity tariff was ill-timed.
“Let them first improve their service for at least a year before contemplating any increment. They should also stop issuing estimated bills,” he noted.
Abia Residents to EEDC: Address Customers’ Complaints First
From Gordi Udeajah, Umuahia
Residents in Abia State are not ready to pay more for electricity now. They told The Guardian that their current bills from the Enugu Electricity Distribution Company (EEDC) were unjustified as there was no commensurate power supply by the DisCo.
The residents also complained of non-installation of pre-paid metres, issuance of estimated bills and slow rectification of faults by the DisCo.
Chairman of one of the market associations in Umuahia, who pleaded anonymity, said the solution to the complaints lies with the DisCo, saying EEDC should address the grievances of consumers against its operations.
He said the company should also provide prepaid metres to consumers before envisaging any hike in tariff.
Tariff Increment Will Add To Our Plights — Kebbi Residents
From Ahmadu Baba Idris, Birnin Kebbi
Residents in Birnin Kebbi, Kebbi State, have described as barbaric the continuous drive for increment in electricity tariff by the DisCos.
Speaking with The Guardian, a retired civil servant in the state, Mallam Hassan Danjuma Jebba, said any increment in electricity tariff would result in a further hike in prices of goods.
He said there was a need for the Federal Government to continue to subsidise power to reduce the sufferings of Nigerians.
“We are talking about COVID-19. If there should be any increment now, there will be inflation in the country. We are experiencing hardship already and you are trying to add more to the plights of the masses,” he said.
He commended the Kano Electricity Distribution Company (KEDCO) for giving the state stable electricity, saying power supply has improved in the state of late.
‘Tariff Hike Will Make No Impact With Existing Power Infrastructure’
From Lawrence Njoku, Enugu
Recently, it was a herculean task in Enugu holding back customers of the Enugu Electricity Company (EEDC) from showing their disdain over poor services being rendered by the company since it took over distribution of power six years ago in the Southeast zone.
The event was the Stakeholders Consultation on the extraordinary review of the Multi-Year Tariff Order organised by the company in collaboration with the Nigerian Electricity Regulatory Commission (NERC).
Speaker after speaker narrated the anguish they had been subjected to in their states, stressing that the company had continued to exploit them in various ways because they had no alternative.
They listed the mode of exploitation from the DisCo to include the inability to metre their consumers leading to estimated billing, obsolete equipment leading to a frequent breakdown in supply, load shedding and poor customer relations.
Assessing the performance of the EEDC, a consumer, Prof. Anthony Ozoemenam, stated that consumers in the state don’t get value for the money they pay for electricity, alleging that the company has continued to run on dilapidated infrastructure since it took over.
“Even if you increase tariff by 200 per cent, with the existing infrastructure and exploitative tendencies of the EEDC, nothing will change. Consumers in the state and the entire zone will continue to suffer. EEDC must show that it has come to serve by improving existing facilities, retraining its workers as well as providing metres to consumers who are daily ripped off in the guise of estimated billing,” he said.
He pointed out that over 60 per cent of the customers had not been metred. “We need to review the privatisation exercise. If you recall what happened during the exercise, a company like EEDC could not even pay the statutory fees they were supposed to pay. They did not meet up with the deadline that the government gave them and somehow, they were able to get a waiver that enabled them to pay. So coming on board, they have not cared to expand their network; those already on the network are not sufficiently served and that is why we have this situation in the state.
“We know that they purchase the light they supply to us, but do they have the capacity to distribute what is available? That is the big question. They can’t continue to run on the old network that they inherited from the PHCN. They should make investments and improve on what is on the ground. That is the area we are not comfortable with,” he added.
Anambra Consumers Laud Suspension Of Tariff Hike
From Osiberoha Osibe, Awka
In Anambra State, electricity consumers appreciated the intervention of the National Assembly, which prompted the Presidency to put the planned increment in electricity tariff on hold.
Speaking with The Guardian, an electricity consumer and community leader, Nehemiah Obuorah, appreciated what he described as “small improvement in the supply of electricity by EEDC,” but faulted its resort to the estimated billing system instead of installing prepaid metres for consumers.
Obuorah said the Energy Commission and the Consumer Protection Council should harmonise the hike if necessary, as done in advanced countries.
He noted that EEDC has performed better than NEPA/PHCN, but said that was no justification to hike electricity tariff.
According to him, energy and transport are key factors of production that have multiplier effects on the micro and macro economy.
“The energy sector in Nigeria is not serious. The industries are not there, yet there is a poor supply of power. They just create touts to go and disconnect people’s light. They are doing touting business,” he lamented.
Another electricity consumer, Bede Nkwocha, described the proposed hike as exploitative, alleging that some consumers who are on prepaid metres receive estimated bills from EEDC.
Rivers Residents Lament Poor Performance
From Ann Godwin, Port Harcourt
Barely six years after the privatisation of the power sector, the Port Harcourt Electricity Distribution Company (PHED) has continued to perform below expectations. The company has not been able to meet the power needs of the people.
Residents who requested for prepaid metres still experience a delay in accessing it, though the firm blamed the challenge on the closure of the state’s borders due to COVID-19 pandemic, which affected the transportation of goods from one state to another.
However, checks around the city revealed that large numbers of people were still under the estimated billing system. Sadly, the services they received were not commensurate with the electricity supplied.
Further observations by The Guardian revealed that PHED has been carrying out new configurations around Rumuosi, Ada George, Rumuolumeni, Wimpey and Iwofe areas of the city, among others. The development, according to PHED’s Corporate Communication’s Manager, John Onyi, would give an additional 48 megawatts to the areas and improve service delivery.
Some residents who spoke with The Guardian alleged that the PHED had not made any difference since they came on board, regretting that their experiences with them were akin to the days of NEPA.
They also described the proposed tariff increase as wickedness by the Federal Government and the authorities involved.
One of them, Emmanuel Brownson, said: “Consumers have been suffering. Residents were almost dying during the NEPA era. We are still having the same experience. There is no light yet they want to increase tariff. This is total wickedness.”
He said Nigerians were tired of the power sector woes, insisting that the distribution company has demonstrated total failure in its services since it came on board.
He called on the government to withdraw the licences of the firms and replace them with reliable companies that could help the country, adding, “the distribution firms are not doing well and we don’t need their services anymore.”
“Even a baby born today should know that Nigerians are tired of the power sector woes; the failure is total. They should replace the DisCos with something that can help Nigerians. They are not doing well. These people are not there to perform but to exploit consumers. When transformers break down, they force the community to contribute money, use part of it to buy the transformer and keep the remaining for themselves,” he added.
He argued that distributing electricity bills without supplying power and forcing the public to pay the bills with the aid of task force amounted to robbery.
Similarly, the Rivers State Chairman of Civil Rights Council, Wiro Prince, said it was disheartening that the power supplied to residents was not commensurate with the bills they receive every month.
“The PHED has not done well; they perform below average. The estimated billing system where from month to month there will be no power and they will issue estimated bills to residents ranging from N10, 000 to N100, 000 is unacceptable,” said Wiro
He urged the Nigerian Electricity Regulation Company (NERC) to ensure that consumers are properly metred before any increase in tariff is implemented.
Power Sector Should Be Made Competitive, Say Ibadan, Osogbo Consumers
From Rotimi Agboluaje (Ibadan) and Timothy Agbor, Osogbo
Despite the power privatisation exercise carried out a few years ago, electricity consumers in Oyo State still complain bitterly about epileptic supply.
In various interviews, the consumers described power supply in Ibadan and other parts of the state as terrible and extremely poor. Some even called for outright disbandment of the DisCos, specifically the Ibadan Electricity Distribution Company of Nigeria (IBEDC).
Mrs. Oluwafunke Adebisi, a tailor, said her area enjoys power mostly in the night, describing the practice as exploitative.
She said: “Power supply is terrible. They restore it in the night especially from 11:00 p.m. to 6:00 a.m. They are just charging us unnecessarily without supply. They should allow prepaid metres to go round.
“If other companies, foreign or local, can handle the sector, let the government review it so that we can have an adequate power supply.”
A barber in Aare area of Ibadan, Mr. Ayobami Johnson, said power supply has become worse in the area.
Johnson said: “The supply was okay before but now it is bad. We get supply for barely three hours daily. It is taking tolls on my business. I spend N20, 000 weekly to buy fuel to power my generating set in order to render services to my customers. Government should improve power supply. Government should do anything that will improve the situation.”
On his part, an estate surveyor, Mr. Seun Amoo, said he and his company didn’t need the distribution company again, saying since he was disconnected he didn’t bother to be reconnected.
Amoo said: “Power supply is bad here in Bodija. They usually restore it in the night when we must have closed from office. We have metres but they prefer to just give us crazy bills. What is the essence? We told them to disconnect us. We got disconnected and we didn’t bother about reconnection.”
However, Mrs. Temitope Adeagbo, a hairdresser whose shop is located at Ojoo-Iwo Road expressway, said: “Partially, we enjoy power but not at its best. They are still trying; though there is not much change compared to the past experience. If it will be better, the privatisation exercise should be reviewed.”
Mr. Yemi Adetiba, a business and investment analyst, said the distribution companies were only interested in exploiting Nigerians.
“In my house located at Akobo, the transformer is bad. Even in my office at Favos junction, we hardly get supply for four hours daily. The DisCos are only interested in exploiting consumers.
“The privatisation exercise was politicised by giving it away to some people to make money. They should review it and give it to those with competence. Let there be more private participation. Let the states generate power. There should be competition in the power sector,” he said.
In Osun State, residents of Osogbo urged government to look into the issue of estimated billing before implementing any hike in tariff.
A community leader in Bolorunduro, Oke-Baale in Osogbo, Alhaji Mufutau Olanite accused IBEDC of over billing electric consumers that use post-paid metres.
Olanite advocated for government’s take over of the DisCos if they fail to address the concerns of consumers.
Olanite said: “IBEDC in Osun State give estimated billing to customers. They promised to rectify the ones they gave to us in the past but they are yet to do it. Those who don’t have pre-paid metres are being served crazy bills.
“Another thing the government should address is the issue of IBEDC officials applying force to demand for payment of bills. This is why electricity consumers often attack them. Can you imagine that we buy wires, poles and other things needed for electricity supply in our area? The only thing IBEDC does is to come and serve us estimated bills.
“When oil finishes in the transformer or it develops faults, they ask us to contribute money to rectify it. The government should take over this sector for us to have peace.”
Speaking in the same vein, a resident of Ogo-Oluwa area of Osogbo, Mr Segun Adegoke, also complained against estimated billing by IBEDC.
“A single-phase metre user in my area is charged between N11, 000 and N40, 000 monthly. This billing system is terrible and the government should look into it. Another thing the government should give attention is the refusal of IBEDC to issue pre-paid metres so that customers can be paying for electricity they use. We pay for what we don’t use. This should be seriously addressed,” he said.
Speaking on the way out of the present challenges in the power sector, Dr. Oladayo Olakanmi of the Department of Electrical/Electronics, Faculty of Technology, University of Ibadan, Ibadan, said it was imperative to bring investors with competence on board and decentralise the sector.
The don stressed the need for the state governments to invest in the sector in order to make power available to the people.
“Maybe they are not professionally competent and they don’t have the financial muscle to achieve the purpose of the privatisation. If you look at it, government tried to divide it into three. We have the generation given to the Generation Companies (GenCos). We have the transmission given to Transmission Company of Nigeria (TCN) and distribution given to the DisCos. The important factor in the chain is the DisCos because they have direct contact with the consumers. We all know that the operators are not competent at all. They are not in existence. They are political moneybags who are perhaps fronting for some people.
“For example, you bought something from me, am I the one to be repairing it for you? No! But that is what is happening in the DisCos. The main challenge is that they don’t even have the financial muscle, because some of them are crying that they don’t have money to run the distribution companies. Anyone that acquires privatised assets is supposed to upgrade them not downgrade them. What is happening now is downgrading compared with when the government had a 100 per cent control over it.”
Olakanmi added: “Persistently, they are saying they want to increase tariff because they see it as the easiest way to make money for themselves.
“If we are to call for a review, you are talking about giving the ownership to another set of investors; there will be a lot of lacuna there. The only thing I believe the government should do is that there should be a serious-minded regulatory body. NERC is not a serious-minded regulator. The responsibility of a serious-minded regulator is to do the empirical costing of electricity supply, a unit cost of energy and look at the current tariff to know if customers are overcharged or undercharged. If they are undercharged, the DisCos will increase the tariff or government subsidises so as to make life comfortable for the consumers who happen to be the citizens.”
No comments yet