Ibrahim Apekhade Yusuf
THE inability of local investors to readily access credit facilities from banks may have stalled the much hyped project for the distribution and installation of prepaid meters nationwide, The Nation has learnt.
Investigation by our correspondent revealed that the most of the electricity distribution companies are yet to meet the metering requirements of electricity consumers.
The Nigerian Electricity Regulatory Commission (NERC) had introduced meter asset provider (MAP) on April 3, 2018, to new investors finance mass metering plan which is expected to reduce incidences of estimated billing to the barest minimum.
The MAP regulation mandates electricity distribution companies (DisCos) to engage meter assets providers who will fund the purchase, installation and replacement of meters to help meet DisCos’ metering obligations to their customers.
Subsequently, 22 companies got approval after due diligence was conducted on the documents they provided in their applications.
However, majority of the MAP licensees have not been able to get the necessary credit lines to go into production.
Confirming this development in an interview with our correspondent, Mr. Kola Balogun, Chairman/CEO, Momas Electricity Meters Manufacturing Company (MEMCOL), a major indigenous meter producer while alluding to the fact that there are local expertise readily available for the production of meters, however said the limiting factor has been lack of finance.
“We have the capabilities and we even have all it takes to address the metering capacity of the country. The manufacturing is going on. We are even doubling the capacity that we have in order to meet the local need. But we are still expecting more response from all the MAP licensees to comply with the 30 per cent local content so that we can even double the capacity or expect request for more operational capacity. The regulation says 30 percent but then since we are doubling our capacity, we can increase the local content requirement to 70 per cent so that we can employ more people and increase the technology capacity of the country. They don’t have the financial strength. Fine the license has been given to them, but accessibility to finance is a major setback. That is what is drawing the MAP implementation to be slow.”
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While giving fresh insights on the metering demand of the country currently, Balogun said, “The figures are still there, it keeps increasing because people keep on building more property. So the metering requirements keep increasing essentially because of the fact that people who were given the license to deploy meter under the MAP scheme are not responding and not doing it as quickly as possible because of the paucity of funds. So they are looking for a single digit interest loan from development finance institutions (DFIs) like the Bank of Industry (BOI), so that they would be able to fund the metering very well both in terms of consumer strength to pay for meter and at the same time some of the players have little access to credit line so those are some of the things the sector players need to look into. If the government can find a way to encourage the DFI s to make credit available at single digit interest rate in order to encourage all the licensees to fund the metering gap.”
The NERC had ordered the DisCos to begin the roll out of new meters by May 1, 2019. However, according to the latest NERC 2019 second quarter report indicated that only 43% of electricity customers were metered as of June.
“Of the total of 8,881,443 registered active electricity customers, only 3,811,729 (42.92%) have been metered indicating that 57.08% of the end-use customers are still on estimated billing,” the report read.
“In comparison to the first quarter of 2019, the numbers of registered and metered customers increased by 40,642 and 17,834, representing 0.46% and 0.47% increases respectively. The increase in the number of registered customers is attributable to the ongoing enumeration exercise by DisCos through which illegal consumers of electricity are brought onto the billing platform of the DisCos.”
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