Nigerian Electricity Regulatory Commission (NERC) has issued a consultation paper to review the various options to fast-track the closure of the metering gap.
Determined to end estimated billing, NERC issued the Meter Asset Provider (MAP) Regulations in March 2018.
In order to ensure transparency in the meter roll-out as provided for in the MAP regulations, deployment of meters could not commence until August 2019 following the conclusion of competitive procurement by DISCOs which was monitored by the Commission.
A total of 611,231 meters have been deployed as at 31 January 2021 under the MAP initiative since its full operation despite the COVID –19 pandemic and other extraneous factors. The challenge of closing the metering gap in Nigerian Electricity Supply Industry (NESI) still persists as more than half of the registered electricity customers remain unmetered.
The existence of a huge metering gap and the need to ensure successful implementation of the MYTO 2020 Service-Based Tariff resulted in the approval of the National Mass Metering Programme (NMMP), a policy of the Federal Government anchored on the provision of long-term low interest financing to the DISCOs.
The main objectives of the NMMP are to increase the meter deployment rate, promote local meter manufacturing, create jobs in the local meter value chain, reduce collection losses and enhance NESI’s financial viability. The NMMP is planned to be implemented in three (3) phases as hereunder:
The Central Bank of Nigeria (CBN) shall provide funding to the DISCOs to procure 1 million meters from the existing stock available from MAPs at the regulated cost already established via the competitive procurement under MAP initiative. All meters to be procured by the MAPs outside their inventory must be from a local meter manufacturer/assembler. This is expected to be implemented over a period of 3-6months.
The CBN shall provide financing to the DISCOs for the procurement of between 3 – 4 million meters through a competitive procurement process among local meter manufacturers/assemblers. The outcome of the procurement process shall provide a benchmark price for single and three phase meters respectively. Contract volumes shall be apportioned to local meter manufacturers in proportion to verified manufacturing capacity.
The World Bank shall provide financing to DISCOs for the procurement of meters to close any remaining metering gap in NESI.
The purpose of the consultation paper is to review the various options to accelerate the closure of the metering gap within the implementation framework of the MAP Regulations and the NMMP and consider the merits and demerits of each option.
The consultation paper is structured into two broad areas:
a. Proposed options for metering implementation going forward:
- To allow the implementation of both the NMMP and MAP metering frameworks to run concurrently;
- To continue with the current MAP framework with meters procured under the NMMP supplied only through MAPs (by being off-takers from the local manufacturers/assemblers); and
- To wind down the MAP framework and allow the DISCOs to procure meters directly from local manufacturers/assemblers (or as procured by the WB), and enter into new contracts for the installation and maintenance of such meters.
Under all three options, the DISCOs shall continue to be accountable for metering as this remains a core responsibility of utilities and a contractual obligation in their Performance Agreements with the Bureau for Public Enterprises (BPE).
b. Draft amendments to relevant clauses/sections of the MAP Regulations 2018 necessary to give effect to each of the identified options above.
The Commission will take into consideration responses to the document and other points or issues that may be raised by stakeholders in reaching a final decision on amendments to be made to the MAP Regulations 2018.
On the basis of the analysis of the various options for restructuring the framework for metering in the NESI, the Commission is seeking response from the general public to provide their input.
Stakeholders have 21 days to provide comments, objections and representations on the proposed amendments. This notice was issued on 24 February 2021.
Upon the expiration of the response period, NERC will hold a virtual public hearing on the proposed review.