… deploys 178,864 Meters
Electricity Distribution companies fell short of their expected revenue targets in the second quarter of 2023. The made a total ₦267.86 billion out of ₦354.61 billion billed to customers.
Even though they failed to meet the targeted revenue, this was however a marginal increase over the previous quarter.
This is according to a second-quarter report which was issued by the Nigerian Electricity Regulatory Commission (NERC), which was prepared in compliance with Section 56(3) of the Electricity Act 2023
The companies also barely improved on meter installation across the country as a total of 178,864 meters were installed in 2023/Q2, representing an increase of 3,583 installations (+2.04 percent) compared to the 175,281 meters installed in 2023/Q1.
The report analyses the state of the Nigerian Electricity Supply Industry
(NESI) covering the operational and commercial performance, regulatory functions, consumer affairs as well as the Commission’s finances and staff development.
According to NERC, the new installations resulted in a 0.85 percent increase in net end-user metering rate in the NESI between 2023/Q1 (43.31 percent) and 2023/Q2 (44.16 percent).
During the quarter,168,397 meters were installed under the Meter Asset Provider, MAP framework while 9,302 meters were installed under the National Mass Metering Programme NMMP framework.
The Vendor and DisCo Financed framework recorded 1,143 and 22 meter installations respectively.
Following the perceived challenges in meter deployment the Commission, charged the DisCos to utilise any of the five meter financing frameworks that have been provided in the 2021 Meter Asset Provider and National Mass Metering Regulations to close their respective metering gaps.
As a safeguard for customers against exploitation due to the lack of meters, the Commission said it has continued to issue monthly energy caps for all feeders in each DisCo.
This sets the maximum amount of energy that may be billed to an unmetered customer for the respective month based on gross energy received by the DisCo and consumption by metered customers.
Under the period in review, the total energy received by all DisCos was 7,100.87GWh while the energy billed to end-use customers was 5,789.21GWh, translating into an overall billing efficiency of 81.53 percent.
This represents an increase of 3.56 per cent relative to the 77.97 percent recorded in 2023/Q1.
The total revenue collected by all DisCos in 2023/Q2 was ₦267.86 billion out of ₦354.61 billion billed to
customers translating to a collection efficiency of 75.54 per cent which represents an increase of 6.79 per cent when compared to 2023/Q1 (68.75 percent).
The increase in collection efficiency was attributed to the increased metering by DisCos and the implementation of various collection campaigns for improved remittance by post-paid customers.
In addition, there was improvement in the Aggregate Technical, Commercial and Collection (ATC&C) Loss.
The ATC&C loss in 2023/Q2 was 38.41 percent comprising – technical and commercial loss (18.47 percent) and collection loss (24.46 percent).
The ATC&C loss declined (improved) by 7.98 percent compared to 2023/Q1 (46.39 percent). The decline in ATC&C loss was largely attributed to the 6.79 per cent improvement in collection efficiency between 2023/Q2 and 2023/Q1.
However, the NERC noted that the 2023/Q2 continued the trend of all DisCos failing to achieve the efficient loss targets allowed in their tariffs. This translates into an inability to collect the revenues that are required to finance the sustainable long-term operations of the business while also providing reasonable returns for investors.
Also with the period, the cumulative upstream invoice payable by DisCos was ₦194.69 billion, consisting of ₦154.04 billion for generation costs from NBET and ₦40.65 billion for transmission and administrative services by the Market Operator (MO).
Out of this amount, the DisCos collectively remitted a total sum of ₦185.36 billion (₦152.48 billion for NBET and ₦32.88 billion for MO) with an outstanding balance of ₦9.32 billion. This translates to a remittance performance of 95.21 per cent in 2023/Q2 compared to the 67.43 per cent recorded in 2023/Q1.
