DISCOS remit N58.8 bn in Q3’19

59.7% of electricity customers still on estimated billing — NERC

By Ediri Ejoh

At the backdrop of a new and higher electricity tariff commencing next month across the country, about 5.8 million of electricity consumers are yet to be captured under the pre-paid meter scheme.

This figure represents 59.7 percent of the total registered electricity consumers in the country.

This came as the remittance from the Distribution Companies, DISCOs, still remain low at  ¦ 58.81billion out of  ¦ 179.66billion issued by the regulator.

This was contained in the 2019 third-quarter report released by the Nigerian Electricity Regulatory Commission, NERC. According to the report, only Abuja and Benin DISCCOs had metered more than 50 percent of their registered electricity customers as at the end of September 2019.

“The metering gap for end-use customers is still a key challenge in the industry. The records of the commission indicate that, of the 9,674,729 registered electricity customers, only 3,895,497 (40.26 percent) have been metered as at the end of the third quarter of 2019,” the commission said.

“Thus, 59.74 percent of the registered electricity customers are still on estimated billing which has contributed to customer apathy towards payment for electricity. In comparison to the second quarter, the numbers of registered and metered customers increased by 8.93 percent and 1.65 percent respectively.

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“The increase in registered customer population is due to the on-going customer enumeration exercise by DISCOs through which illegal consumers of electricity were brought unto the DISCOs’ billing platform.”

The NERC also attributed the increase in metered customers to the roll-out of meters under the meter assets provider (MAP) scheme.

It would be recalled that NERC had in February issued an order to cap estimated billing by DISCOs to unmetered customers, adding that such moves would protect customers from unrealistic billing until a prepaid meter is installed by the DISCOs.

The NERC and the ministry of power have also set a target to close the metering gap by December 2021.
Power sector’s financials.

On the industry’s financials, the report noted that “the financial viability and commercial performance of the industry continued to be a major challenge with a slight improvement in the third quarter of 2019. During the quarter under review, the total billing to electricity consumers and total collection from electricity consumers by the DISCOs stood at  ¦ 172.90billion and  ¦ 119.29billion respectively.

“These denote 81.59 percent and 68.99 percent billing and collection efficiency respectively, indicating a 1.41 percent point increase and 0.11 percent point decrease respectively when compared with the second quarter of 2019.

“The level of collection efficiency during the quarter under review indicates that as much as  ¦ 3.10 out of every  ¦ 10 worth of energy sold during the third quarter of 2019 still remained uncollected from consumers as and when due.”

Also, on remittance to the power sector, it noted that “During the third quarter of 2019, a total invoice of  ¦ 179.66billion was issued to DISCOs for energy received from The Nigerian Bulk Electricity Trading, NBET and for service charge by MO, but only a sum of  ¦ 58.81billion of the total invoice was settled, representing 32.73 percent remittance performance. “This represents a 2.13 percentage points increase from the settlement rate recorded in the second quarter of 2019.

“This indicates that DISCOs’ remittance level, regardless of the prevailing tariff shortfall was still below the expected minimum remittance threshold. Thus, to ensure business continuity and improve sector liquidity, DISCOs must continue to improve on efforts towards reducing their  Aggregate Technical and Commercial Collection Losses,  ATC&C, losses to levels commensurate with their performance agreement.

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