Customers react over electricity tariff as DisCos unveil estimated bills

As the capping of estimated electricity bills regulation is being implemented, many customers of the Distribution Companies (DisCo) have insisted that they still get outrageous bills. Our reporter collated series of complaints from consumers in parts of the Federal Capital Territory (FCT), Nasarawa State, Benue, Kaduna, Kano among other states on the February bill distributed […]

As the capping of estimated electricity bills regulation is being implemented, many customers of the Distribution Companies (DisCo) have insisted that they still get outrageous bills.

Our reporter collated series of complaints from consumers in parts of the Federal Capital Territory (FCT), Nasarawa State, Benue, Kaduna, Kano among other states on the February bill distributed to consumers early March.

The complaints are coming just as consumers expect the Nigerian Electricity Regulatory Commission (NERC) to approve about 51 percent hike in electricity tariff by April 2020. The commission had just concluded a nationwide public consultation for the tariff increase across the 11 DisCos and is in the process of reviewing the contributions from stakeholders including customers before approving the tariff next month.

Despite the countdown to the tariff hike, the capping order 2020 released by NERC shows that as of December 2019, there were 10 million registered electricity customers. But 5.2 million of these customers representing 52 percent have not been metered and are still under the estimated billing.  However, 4.8m other customers have gotten meters installed in their homes.

The lack of meters has put customers at the mercy of the DisCos as scores of customers claim they are often charged ‘crazy’ and exploitative bills amidst several outages and monthly energy load rationing.

NERC in 2018 introduced the Meter Assets Providers (MAP) Regulation to accelerate metering for the 5m consumers. The process did not begin until May 2019 but still believe that the increase in metered customers as of September was due to the MAP scheme. The Commission is also hopeful that within 3 years, current metering gap could be bridged if the DisCos are consistent.

MAP metering target records from 10 of the DisCos obtained from the Nigerian Electricity management Services Agency (NEMSA) indicates that they will deploy 5.545 million in four years from May 2019.

The lack of meters, NERC said in the capping order, has resulted in unrealistic billing of unmetered customers accounting for over 65 percent of complaints lodged at customer care centres of DisCos, disputes filed at Forum Offices and subsequent appeals to the Commission.

“The significant level of customer dissatisfaction arising from unrealistic estimated bills have also adversely impacted on the market revenues as a consequence of customer apathy and declining willingness to settle their invoices in full,” NERC added.

How estimated bill cap order works

To cushion the effect of escalation in the estimated billing with a looming 51 percent tariff hike, NERC had since 20 February 2020, pegged payment for electricity bills by customers who are under the estimated billing methodology. The capping order stipulates the maximum amount a DisCo can charge customers in specific locations.

As the new tariff set in, only high energy consumers are free from estimated bill if they are not metered by April ending. The Residential 2 (R2) and Commercial 1 (C1) customers whose bills have been capped will have to bear the brunt until they are metered through MAP by Year 2021 or 2022.

NERC has set three years for the unmetered customers to be metered beginning from May 2019. To hasten this, it rolled out the capping of estimated billing regulation saying it is a trigger for DisCos to hasten the metering process so they can prevent revenue loss.

It said DisCos must meter all higher energy consuming customers (MD) by 30 April 2020 and shall not be disconnected as they are not liable to pay estimated bill again. However, the unmetered R2 and C1 customers must not be billed more than a template NERC has approved for the DisCos.

Mustapha Segun, a resident of Lugbe in the FCT said they were expecting their bill to be less than N2,000 but were surprised that the house got about N9,000 bill.

“We used to pay about N7,500 every month but the bill has increased for us. We don’t understand how this order works,” he noted.

The cap template however shows that customers in Lugbe area should only pay N4,600 per month with inclusion of Value Added Tax (VAT).

At Kpana Village in Jabi area of FCT, shop owners said their bills rose to N11,000.

“I used to get around N5,000 but we got N11,350 this month and we were expecting to hear that our bill will crash to N1,800,” said Madam Blessing Michael. A quick check on the NERC approved template for Abuja DisCo shows that Commercial 1 customers in Jabi should only pay N10,370 with VAT.

Contrary to the sharp rise in the bill, some customers said their bills dropped.

In Ugbokolo town of Benue State, a residential customer, Mrs. Ugwu Maria, said her bill dropped from N4,500 to N2,950. A template verification of this showed that Ugbokolo which is under Otukpo region of Jos DisCo has N2,800 as the highest bill.

In Mararaba town of Nasarawa State, Okpotu Johnson said his bill crashed to N2,700 from nearly N7,000 in January 2020.

“This capping has worked in our area where we don’t often constant power supply. I was amazed that the bill dropped to N2,700 recently,” he noted. A template check indicates that the residential customers should not have paid more than N2,500 with VAT.

Malam Garba Isa who lives in Barnawa Low Cost in Kaduna said his bill was slightly above N2,000 but he ought to pay N1,582 excluding VAT rate. “At this level, I was even surprised because it used to soar to N5,000 before,” he added.

In Tudun Wada quarters of Kano, Musa Shehu said his compound got N3,500 bill, reducing from 4,800 they have been getting. However, the Kano DisCo template shows that the bill for that area has been capped to N2,205 excluding 7.5% VAT.

What customers could pay

The NERC order template check shows what residential customers should pay across major cities in Nigeria, exclusive of the prevailing 7.5 VAT rate.

Such AEDC customers in Gwarinpa, Wuse, Maitama and Kubwa in Abuja can’t pay estimated bill above N8,845, N9,841, N10,497, N2,770 respectively. AEDC customers in Keffi and Lafia in Nasarawa State can only pay N2,502 and N2,284 respectively.

Under Ikeja DisCo in Lagos State, customers living in Ikeja, Ikorodu and Oshodi will not pay above the cap of N4,409, N2,385, and N3,045 respectively.

R2S customers of Kaduna DisCo in Barnawa, Zaria, Birnin Kebbi and Sokoto will not pay above N1,582, N1,714,   N1,582, and N1,582, respectively.

R2S customers of Enugu DisCo in Aba, Nsukka, Owerri and Nnewi can only pay N2,783, N2,288, N2,998 and N2,567.

We’ve complied with NERC order – DisCos

When contacted, the Abuja Electricity Distribution Company (AEDC) said it had complied with the order capping estimated billing order of NERC.

The General Manager, Corporate Communications of AEDC, Mr Oyebode Fadipe, said the capping of estimated bill was an order by NERC that AEDC was obeying.

He further explained that NERC had pegged the maximum amount certain areas will pay per month for electricity supply.

“The capping is a NERC Order. It is an Order we are bound to obey. As for the one that you allege is above the NERC cap, I need to see it,” Fadipe said regarding the customers’ bills above the N10,370 cap limit for Jabi area of the FCT.

The spokesman of Kano Electricity Distribution Company (KEDCO), Ibrahim Sani Shawai said the DisCo it has sensitized 104 communities in Kano, Katsina, Jigawa on issues in the power sector. Among these is the NERC capping of estimated billing and the new tariff.

He said in a statement that this is being done to properly sensitize customers on issues they may need better clarification and also to have a one-on-one approach to get responses from customers on areas KEDCO needs to improve upon.

“With this, they will know the policies of the government being introduced and how they can also be part of the reforms through active partnership in terms of paying their bills, proper reporting of complaints and attempts to vandalize KEDCO’s equipment,” Shawai noted.