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DISCOs collected N114bn revenues in Q1 of 2020 – NERC

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New electricity tariff exploitative, consumers tell NERCBy Chris Ochayi

The latest quarterly report issued by the Nigerian Electricity Regulatory Commission, NERC, showed that a total of N114 billion was collected as revenue by the 11 electricity Distribution Companies, DISCOs in the first quarter of 2020.

The report also indicated that while the collection efficiency decreased considerably, the regulatory agency listed Abuja, Benin and Eko DISCOs as the companies with the most efficient collection systems.

Meanwhile, the report which covered the first quarter of 2020 also showed that the country generated more electricity compared to the last quarter of 2019 with total electricity generated put at 8,613,998MWh, 6.33 per cent more than the energy generated during the preceding quarter.

The regulatory agency noted that the collection efficiency implied that for every N10 worth of energy billed to customers by the Discos in the first quarter of 2020, approximately N3.88 remained unrecovered from customers as and when due.

While reiterating that financial viability of industry has remained a major challenge threatening its sustainability, NERC noted  that as highlighted in the preceding quarterly reports, the liquidity challenge is partly due to the non-implementation of cost-reflective tariffs.

The commission also listed high technical and commercial losses exacerbated by energy theft and consumers’ apathy to payments under the widely prevailing practice of estimated billing as part of the challenges of the industry.

“It was noteworthy that the payment cycle for March invoices fell sharply within the period of the outbreak of Covid-19 pandemic,” said the power sector regulator.

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According to it, “The total revenue collected by eleven (11) Discos from customers in the first quarter of 2020 stood at N114.29billion out of the total bill of N186.82billion.

“ Similar to the observed trend in billing efficiency relative to the preceding quarter, the Discos’ collection efficiency (i.e. the total revenue collected as a ratio of the total billing by Discos) declined in 2020/Q1.

“The overall collection efficiency for all Discos decreased to 61.18 per cent in the first quarter of 2020 representing 8.26 percentage points decrease from the 69.44 per cent collection efficiency recorded in 2019/Q4,” it stated.

It added: “The collection efficiency implies that for every N10 worth of energy billed to customers by Discos in the first quarter of 2020, approximately N3.88 remained unrecovered from customers as and when due.

“This low collection efficiency combined with billing inefficiency has continued to adversely impact the financial liquidity of the industry, which in turn, has led to low investment in NESI.

“During the first quarter of 2020, the total electric energy generated was 8,613,998MWh – 6.33 per cent more than the energy generated during the preceding quarter. Within the same quarter, the industry recorded a peak daily generation of 5,268MW.”

Vanguard

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