The Federal Government has approved N21bn under the Presidential Metering Initiative to close the country’s metering gap by providing meters to unmetered power users at no cost.
That was announced in an order by the Nigerian Electricity
Regulatory Commission on Friday with the number – NERC/2024/072, titled “Order
on the Operationalisation of ‘Tranche A’ of the Meter Acquisition Fund”.
The commission stated that the deployment of funds under the
Meter Acquisition Fund scheme would accelerate the deployment of meters and
close the current metering gap.
It added that this would help in reducing commercial and
collection losses to power distribution companies, enhancing the quality of
service, and improving customer satisfaction.
“The funds accrued as of the April 2024 market settlement
cycle and available for procurement of meters under the first tranche of the
MAF scheme is in the sum of NGN21,864,851,725. The commission hereby approves
the use of a sum of NGN21,000,000,000 apportioned pro rata to contribution by
the Discos as Tranche A of the MAF scheme,” NERC stated in the new order.
It said the fund was broken down and allocated to each Disco
for the purchase of end-use customer meters.
“All the meters to be procured and installed under the MAF
framework shall be at no cost to the customers of the Discos,” the power sector
regulator noted.
The commission further said, “This order shall become
effective on June 13, 2024, and may be amended or revoked by subsequent orders
issued by the Nigerian Electricity Regulatory Commission.”
In ia bid to ensure the metering of power consumers, NERC
introduced the Meter Asset Provider Regulations 2018 and subsequently, the
Meter Asset Provider and National Mass Metering Regulations in 2021.
The regulations provided several options for metering
customers but the interventions, though significant, have not resulted in the
closure of the national metering gap, which currently stands over seven million
customers.
The inability of distribution companies to raise financing
in the form of debt or additional equity has been identified as the major
constraint in the acquisition and deployment of end-use meters and other
capital investments.
The Meter Acquisition Fund scheme was, therefore, developed
and approved by the commission, primarily to address the challenge of Disco
credit worthiness inhibiting the deployment of end-use meters in NESI by
creating a credible revenue stream from the market funds on the back of which
long term financing may be secured by the utilities.
The funds, according to NERC, shall be under the management
of the fund manager based on terms and conditions negotiated by the Discos and
approved by the commission.
The Federal Government approved the Presidential Metering
Initiative to close the metering gap in the NESI within three years, leveraging
smart metering technologies for data analytics.
The commission also approved the deregulation of meter
prices under the MAP scheme vide order NERC/2024/040 to ensure on efficient
pricing of meters while responding more quickly to changes in macroeconomic
parameters.
The order provided that all prices of meters under the MAP
scheme should be determined through a transparent and competitive bidding
process by eligible MAPs.
“A competitive bidding process was held on May 21, 2024,
based on the provisions of Order NERC/2024/040, where a total of 24 MAPs
participated across the 12 Discos. A total of 44 bids were submitted for
10-meter specifications.
“While the NESI is expected to leverage on the revenue
stream under the MAF framework to raise substantial capital funding for
metering, there is an imperative to accelerate a closure of the metering gap
for all customers currently classified under tariff Band A for revenue
protection and facilitating demand side management for the affected customers,”
NERC stated.