Sunday Magazine

Outrageous bills: Dealing with DISCOs’ exploitation, frustration

Amidst harsh economic realities, lamentations by a great number of unmeterred Nigerians over exploitative and bizarre estimated billings have not ceased. In this piece, LADESOPE LADELOKUN writes on the plight of Nigerian electricity consumers and failure of regulatory agencies to guarantee succour

 

 

Temitope Adebowale (not real name) a staff of an Engineering firm has been hearing and reading countless stories of estimated billing by Distribution Companies, otherwise known as DISCOs in the Nigerian electricity sector.

 

 

He had read and heard countless tales of electricity consumers slapped with outrageous bills with little bearing on quality of services by, in their thinking, dodgy power firms. He concluded that their lamentations had reached a disturbing decibel. Unknown to him, it was only a matter of time that he would have his own dose of bitter pills.

 

The father of three, who lives in a threebedroom apartment in the Ogba area of Lagos State, had yet to recover from the shock of being billed over an estimated one million naira a month for electricity said to be consumed by his household. It was not because he runs a flourishing business within the same facility or a worship centre housing power-consuming state-of-the art equipment. According to him, he lives only on the salary he earns as an employee in a Lagos -based engineering firm.

 

“They said my bill was over a million naira. There was another N355,000 they said I was owing .Since November, I’ve been battling it. Eventually, I got in touch with their some top managers, who assured me the matter would be resolved. I was then told to pay a a certain amount of money, which they claimed was half of what I owed. I actually got a new metre then, which was installed. When I paid the half they requested, I added over N10,000on top to recharge but I only got less than 20 units.

 

“Meanwhile, they said the metre was free. I paid N63000 officially for metre. They said if you pay,they will credit you back.I got nothing. What they did is to deduct some of my money, claiming it has to do with the preloaded units in the metre. There is a general incompetence in Discos. They don’t care. They are just playing with the fortunes of Nigerians.”

 

For many, while the search for regular electricity supply has remained elusive, having to pay outrageous bills for same beggars belief. But electricity consumers have embarked on a series of protests over what they described as dubious and harsh billing following failed attempts in accessing prepaid meters.

 

At the end of the third quarter of last year, Nigerian Electricity Regulatory Commission (NERC) had stated that 62.67 per cent of electricity consumers in the country were still on estimated billing, as the commission’s Key Operational and Financial Data of the Nigerian Electricity Supply Industry (NESI) for January 2019 to September 2021 showed that, of the 12,784,685 registered energy customers as of September 2021, only 4, 772,906 (37.33 per cent) had been metered. Meanwhile, the Speaker of the House of Representatives, Femi Gbajabiamila, had in  2019, sponsored a bill that sought to criminalise estimated billing of electricity consumers by distribution companies.

 

Though the proposed law failed to see the light of the day, it also sought to compel a distribution company to provide prepaid metre to an applicant within 30 days, while barring the DISCOs from disconnecting the consumer after the 30-day period within which meter should be installed. Bemoaning the failure of the National Assembly to criminalise the issuance of estimated bills, the National President, Energy Consumer Rights and Responsibility Initiative (ECRRI) Mr Surai Fadairo, had declared that the only way customers could be best served was for them to get metered to prevent further exploitation.

 

More tales of anger

 

Irked by irregular electricity supply and regular outrageous bill, Mrs Abibat Abiodun, a resident of Ogunrun in the Obafemi Owode Local Government Area of Ogun State, said she had ditched the Ibadan Electricity Distribution Company( IBEDC). For her, it is pointless paying for huge bills for darkness. “I’ve told my landlord to disconnect me from the power source. It doesn’t make sense to pay huge bills for darkness. It’s cheaper  and more reliable to use my generator.

 

These people just sit down in their offices to determine what everyone would pay. It doesn’t matter to them if it makes sense or not,” she said. Last week residents of Aminkale Community of Alagbado, Oke-Odo, Lagos State, held a peaceful protest over what they call the epileptic power supply to the community by the Ikeja Electric Distribution Company. According to the protesters, they get seven hours supply of electricity in a month and an average monthly electricity bill of N10, 000. Earlier, amid the COVID19 pandemic when a Redeemed Christian Church Parish (name withheld ) in the Oke Aro area of Ogun State was said to have been billed N30,000 a month for five straight months, despite being shut.

 

A source, who spoke on condition of anonymity to Sunday Telegraph said: “For five straight months, the church was shut. No one came to worship but bills were dropped, even when electricity was not consumed. Being a small church, they could not bear the burden of the imposed debt and they had to resort to using a generator.” Also, a former House of Representatives Speaker, Yakubu Dogara, had told his colleagues how his house in Bauchi, which had no occupant, was receiving a monthly bill of N80,000.

 

‘Estimated billing not unique to Nigeria, consumers still under-billed’

 

In a statement, the Association of Nigerian Electricity Distributors (ANED) dismissed reports that, in an effort to meet set targets, DisCos conjure figures, noting Nigeria is not the only country that practises estimated billing. According to ANED, marketers do not give bills that do not reflect customers’ electricity consumption. ANED’s Executive Director for Research and Advocacy, Sunday Oduntan, argued that estimated billing is scientific and customers are allowed to contest their billing.

 

“We are simply saying people should pay us what they owe and our people are given the data on what is being owed and by who. DisCos do not arbitrarily make up billing figures. Where the customer or group of customers do not have pre-paid metres, there is an approved methodology for the computation of estimated bills, designed by NERC, which the DisCos follow. It ensures that the amount of energy consumed through a particular distribution transformer is paid for by those who utilise the said transformer.

 

“Estimated billing is scientific and Nigeria is not the only country that practises it. In addition, customers are also allowed to contest their billing. We don’t just bill people to get money. NERC’s Methodology for Estimated Billing Regulations 2012 (Estimated Billing Methodology Regulation) was specifically introduced in 2012 to ensure energy consumed is paid for and also to ensure DisCos do not issue to electricity customers arbitrary electricity bills, which did not reflect their actual power consumption. This has been further regulated through the Capping of Estimated Billing Order 2020.”

 

According to the DisCos, electricity consumers are under-billed, adding that there is a need for customers to pay cost-reflective tariff for distribution companies to be efficient as expected.

 

Nigerians can rely solely on green energy -Expert

 

Speaking on the demand for alternative source of energy, an inverter producer and Chief Executive Officer of Pots Integrated Systems, Engr. Olabode Otuwehinmi, explained that the demand for solar power system has spiked, noting that the availability of pocket-friendly devices has fuelled an increase in demand.

 

“The capacity and what you intend to power are what would determine the price and sizes. For example, a 30W solar generator costs 65,000 but 60W costs N135,000. Also, 118L of solar freezer costs N153,000 but N168L costs N197,000. Quality determines the prices most times. In addition, due to exchange rates, we don’t have a fixed or stable price.

 

Technology keeps getting better and we have some countries solely relying on green energy and which is not limited only to solar and inverter only. Also, research keeps going on and things get upgraded and so that people can see the benefit of solar  system,” he added. For Olusesan Sina, CEO of Shegzy Investments, the economic situation has not really encouraged Nigerians to seek an alternative means of electricity consumption.

 

“The truth is Nigeria’s economic situation has really slowed down businesses. It’s not that people love to be in darkness but if I ask you to pay N1.5million for an inverter, the likely questions will be: have I bought a land? Have I bought a car? It’s not that people don’t know the value but what you can afford determines what you get. For instance, an inverter that costs N150,000, the battery will be about 40W. So, the sum of the Waltage your appliances consume must be within 40W. So, if you go beyond 40, you get an alert.

 

“The one I use here costs N750,000. It serves me well. You see, with money you can forget about DisCos. I can still remember vividly when I was still an apprentice. My boss had a client that just returned to Nigeria then. They could not stand the darkness created by epileptic power supply. “They paid close to N16million then to power their three houses.

 

They could do anything with it. It’s possible to ditch the DisCos but your pocket must be deep. If you come for an inverter of N200,000, you can’t in all honesty expect to enjoy the same thing the person that buys the one of N750,000 or N1.5million enjoys.

 

Higher tariff, more darkness?

 

Earlier in the year, six distribution companies had got approval from the NERC to increase tariffs.

 

According to a document  issued on December 29, 2021, and signed by Sanusi Garba, NERC Chairman, the new tariff took effect from February 2022. The document titled, ‘This regulatory instrument shall be cited as Multi-Year Tariff Order (MYTO-2022) for Port Harcourt Electricity Distribution Company Plc (PHED)’, read in part: “Consequently, following the approval of PHED’s PIP on 30th April 2021, the Commission issued the MYTO-2021 Extraordinary Tariff Order effective from 1st July 2021 in consideration on PHED’s CAPEX proposals over a 5-year plan in line with the approved PIP”.

 

“Accordingly, this MYTO-2022 order restates PHED’s approved 5-year CAPEX and relevant assumptions applied to forecast revenue requirements and applicable tariffs for the period 2021-2026 in line with MYTO Methodology and Regulations Procedure for Electricity Tariff Reviews in the Nigerian Electricity Supply Industry (NESI).” Last month, NERC revealed an adjustment to electricity tariffs with some customers having to pay about 12 per cent rise in price.

 

But stakeholders have condemned what they described as insensitive tariff rise amid poor electricity supply. Explaining the reason for low energy supply,

 

Oduntan said: “There were significant periods of low or reduced energy supply nationwide, leading up to the month of April, as a result of the various factors stated by the Minister of Power, Abubakar Aliyu, in March of this year. As such, the energy supplied to the distribution end of the value chain has been constrained.

 

“DisCos remain committed to continually improving on electricity supply services, based on the energy made available to them on the grid on a daily basis. Additionally, we continue to believe that the challenges of the Nigerian Electricity Supply Industry, NESI, can best be resolved with collaboration and alignment of all the interests of the stakeholders versus finger pointing.”

 

In its 2020 report, the National Electricity Regulatory Commission, NERC, noted that the estimated billing, metering and service interruption remained the most significant areas of concerns for customers, accounting for 64.88 per cent of the total complaints in the second quarter of 2020.

 

It added that to ensure speedy metering of electricity customers in order to meet the target of closing the metering gap in NESI by 31 December 2021, the Commission, in addition to “securing waiver of the levy previously imposed on imported meters, continued its monitoring of DisCos’ implementation of and compliance with the provisions of the MAP Regulations to fast-track meter rollout.”

 

Not a hopeless case – DG FCCPC

 

In a chat with Sunday Telegraph, the Chief Executive Officer of the Federal Competition and Consumer Protection Commission (FCCPC), Babatubnde Irukera, said the commission was working closely with NERC to curb the simmering cases of outrageous bills from the Discos.

 

Irukera expressed confidence that the impact of its collaboration with the regulatory body would soon be felt by electricity consumers, stating that it’s not a hopeless case.

 

The FCCPC had earlier insisted that consumers should be billed according to the hours of electricity supplied with respect to the approved band classification and can challenge questionable tariff band classification assigned to them. “During this period of severe electricity shortages and palpable customer dissatisfaction, DisCos must be mindful of their commitments and respect consumers’ rights. Customers shall be billed according to the hours of electricity supplied (approved band classification).

You have a right to contest the tariff band classification you have been assigned. “Payment for meters shall not be made if meters are not available. The Meter Asset Provider (MAP) shall install the meter at the premises of the customer within 10 working days of payment,” the FCCPC wrote in a series of tweets.

 

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