The bids for the $500million World Bank-funded National Mass Metering Programme (NMMP) have been opened by the federal government with some Nigerian companies set to face daunting challenges that may make them not eligible to participate in the exercise
.There have been allegations that some of the local companies that assemble meter components lack financial integrity because there was an allegation by the Central Bank of Nigeria that they diverted the fund made available for them for the previous phase of the programme.
This act some industry sources said will certainly hunt some of the companies if they participate in the bid process.
Another problem is that, this time around the local companies may face stiff competition from international companies that have indicated interest in the exercise.
The Central Bank of Nigeria (CBN ) had in 2022 directed that 57 accounts of some of these local be freezed because of an alleged diversion of fund meant for mete supply.
It accused Meter Asset Provider (MAP) companies of allegedly diverting the intervention funds meant for the procurement of Meter for Nigerians.
“The diversion of the power sector intervention funds under the National Mass Metering Programme (NMMP) provided by the applicant’s banks, has further occasioned grave instability in the power sector and sustained the estimated billing regime which the federal government is making frantic efforts to make a thing of the past.
“The diversion of the said funds through the bank accounts of the defendants has continually undermined government efforts at finding lasting solution to the problem of having efficient and effective metering system.
“The applicant’s bank intervention system supports various sectors of the Nigerian economy.
“The diversion of the said funds and sustained instability in the power sector is capable of causing significant economic and financial loss to investors, as well as the entire systems and the Nigerian economy in general, if not curtailed,” the CBN stated.
The bid ceremony which took place in Abuja saw 47 firms, both local and international; submit bids for the procurement of 1.25 million electricity metering devices, one of the biggest single phases ever in the country’s history.
Olu Verheijen, Special Adviser to the President on Energy, In her remarks, stated that the federal government was committed to ending electricity estimated billing throughout the country to reflect cost -reflective tariffs.
“The Federal Government of Nigeria is committed to delivering reliable and cleaner electricity to Nigerian people and businesses. We are embarking on reforms that will improve the performance of Distribution Companies (Discos) as we continue our trajectory to cost-reflective tariffs.
“In the first step to fulfilling our campaign promise to end estimated billing, we are launching phase two of the ambitious national mass metering programme. The phase involves procuring 1.2 million pre-paid meters, with the procurement process set to begin this month,” she stated.
The president’s aide explained that the government wants to solve the problem of estimated billing and revenue assurance as well as build trust and public confidence by ensuring people pay for the electricity they consume.
It was further gathered that the government admitted international vendors to participate because of the need to deliver and as efficiently as possible to end the complaints of Nigerians which had been on for decades.
Also speaking, the Project Manager for the World Bank project and an Assistant General Manager, Transmission Company of Nigeria (TCN), Tukur Bamalli, noted that the government expects that with the new phase, the price of meters will fall substantially.
“We have just closed the submission and opening ceremony for supply and installation of smart meters. We have just received the bids. The president of Nigeria, Bola Tinubu, decided that estimated billing should be abolished and that we should make sure that we supply smart meters to the 11 distribution companies to end the estimated billing.
“We are procuring 1.25 million meters funded by the World Bank to be supplied to the 11 distribution companies. This programme is phase two. We started in February 2021 and it now became effective in February 2023. Very soon the contract will be signed to procure the meters for onward distribution,” he stated.
Bamalli explained that project covers three phases, namely 0, 1 and 2, pointing out that the ceremonial was for phase two of the programme funded by the World Bank.
“The current rate of the meters will be determined after the evaluation. The bids have just been submitted and being opened, so the price will be determined based on the submission of the bidders.
“We are hoping that the cost of the meters will come down so that the Discos can supply meters to Nigerians at lower prices. The participation is for both Nigerians and foreigners and it is completely internationally competitive bidding both for the local and foreign companies.
“The project is funded under a $500 million World Bank loan comprising $155 million for the procurement and supply of smart meters and $345 million as loan to the distribution companies for the upgrade of the distribution network within the country.
“We (TCN) spent almost two years to prepare that process and we concluded the process together with Nigerian Electricity Regulatory Commission (NERC) and the office of the former vice president.
“However, funding it became an issue because the Central Bank of Nigeria (CBN) could not get the resources to execute the project, which was 4 million meters under phase one. I’m aware that there’s effort to resuscitate that project by the president,” he added.
Total number of bids submitted, he said, includes 38 physical and nine online bringing it to 47 bidders for the five slots.
“We have 15 per cent preference for local companies. That means that if a local manufacturers’ bid is higher by 15 per cent than the foreign bidder, the local bidder will be preferred above the foreign bidder.
“The supply and installation of the smart meters is expected to be concluded in 18 months from the signing of the contract. We expect to sign the contract in the one and a half months. The duration for is for 18 months.
“The target is that by the first quarter of 2025, the meters would have been supplied. We expect the meters to start coming in from June 2024. The 4 million meters under phase 1 was to be funded with N200 billion from the CBN,” he added.