Between January and September 2023, power distribution companies (DISCOs) in Nigeria overbilled approximately 7.1 million unmetered electricity consumers, accumulating over N105 billion in excess charges. This finding was revealed through an analysis conducted by the Nigerian Electricity Regulatory Commission (NERC), a Federal Government agency overseeing the country’s electricity sector.
The analysis, part of the Regulatory Interventions for Non-Compliance with the Order on Capping of Estimated Billing to Unmetered Customers, highlighted the extent of overbilling across the 11 DISCOs. For instance, Yola DISCO overcharged around 42,902 customers, resulting in N541.9 million in excess fees, while Abuja DISCO overbilled 1,823,218 customers, leading to N17.9 billion in undue charges.
The report also detailed the overbilling by other DISCOs, including Benin, Enugu, Eko, Ibadan, Jos, Ikeja, Kaduna, Kano, and Port Harcourt, each contributing to the total overcharged fees. In response to these violations, NERC has decided to deduct N10,505,286,072 from the annual allowed revenues of the 11 DISCOs during the following tariff review as a sanction for their non-compliance with the capping of estimated bills for unmetered customers.
NERC’s order mandates that DISCOs issue credit adjustments to all over-billed unmetered customers by March 2024 and publish the list of beneficiaries in two national dailies and on their websites by March 31, 2024. This move aims to rectify the overbilling issue and protect consumers from arbitrary charges.
The overbilling issue has been a significant point of contention, with electricity consumers nationwide lodging numerous complaints against DISCOs for excessive estimated bills. According to a NERC report, a total of 333,947 complaints were lodged by power consumers in the third quarter of 2023 alone, highlighting the widespread dissatisfaction with billing practices among Nigerian electricity users.
The recent revelation by the Nigerian Electricity Regulatory Commission (NERC) about the overbilling of 7.1 million unmetered customers by DISCOs is a stark reminder of the challenges plaguing Nigeria’s power sector. This issue reflects the systemic inefficiencies within the distribution networks and underscores the urgent need for regulatory oversight and consumer protection.
The imposition of sanctions by NERC is a commendable step towards holding DISCOs accountable and ensuring fairness in the billing process. However, this incident highlights a deeper issue: the critical need for widespread metering to eliminate estimated billing practices that disadvantage consumers. The government and regulatory bodies must accelerate efforts to meet all electricity consumers, fostering transparency and trust in the billing process.
This situation calls for a broader dialogue on reforming Nigeria’s electricity sector, focusing on infrastructure improvement, regulatory compliance, and adopting innovative solutions to enhance service delivery. Stakeholders across the board, including government agencies, DISCOs, and consumers, must collaborate to address these challenges head-on, paving the way for a more reliable, efficient, and consumer-friendly electricity supply system.
As Nigeria strives to improve its power sector, the lessons learned from this overbilling saga should inform future policies and regulatory measures. Ensuring equitable treatment of consumers and fostering a culture of accountability and transparency within DISCOs will be crucial in achieving the long-term sustainability of the country’s electricity sector.
Did You Know?
- Nigeria’s electricity sector is divided into generation, transmission, and distribution segments, with DISCOs responsible for the final distribution to consumers.
- Estimated billing has been a contentious issue, leading to widespread calls for implementing a more accurate metering system.
- The Nigerian Electricity Regulatory Commission (NERC) regulates and monitors the electricity industry, ensuring fair practices and protecting consumers’ interests.
- The move towards metering all electricity consumers is part of Nigeria’s efforts to reform its power sector and improve service delivery.
- Consumer complaints in the electricity sector cover a range of issues, including metering, billing, and service interruptions, reflecting the need for ongoing improvements in the sector’s operations and customer service.