The Kaduna Electricity Distribution Company (KEDC), which was sold to private investors by the Federal Government, is yet to be handed over to its owners. In this interview with TONY AKOWE, its Managing Director, Mallam Mohammed Idris Mohammed, speaks on the firm’s prospects.
What are the challenges you face in the course of doing business in the states covered by the Kaduna Electricity Distribution Company that you think should be addressed before it is handed over to its owners?
We are fully prepared for the take-over of the company by the new owners. However, let me announce to our customers what we intend to do for their benefit before the new owners take over.
First, last year, the KEDC had the best financial report. By December last year, our cash collection was N1.070 billion which is the highest in the history of revenue generation of the company. Also, as cash collection recorded the highest peak, power generation also reached its peak.
By December 2013, power generation reached 114 MWs. The effect was that there was corresponding increase in cash collection because of the availability of power. We would not have achieved that without the support of the media. We had a lot of challenges during the year and we had to prepare strategies to overcome those challenges.
Some of the greatest challenges we had were those of public enlightenment, especially on the status of power supply, on the need to prevent vandalisation of our equipment, the need for our customers to appreciate the services that we are providing by making them pay their electricity bills as and when due, and also appealing to our customers to ensure they do not bypass our electricity meters.
However, through the commitment of members of the press, we were able to overcome those challenges and they contributed to our attaining the highest performance in December.
Nonetheless, for us in KEDC, there is hope that we will realise our dream. We are hoping that before the handover of the company to the new investors, we should be able to meet our settlement invoice, to pay our market requirement by the end of the month. Meeting our settlement invoice means that our bills would have been successfully collected, the running cost for the month successfully settled and be able to pay salaries without recourse to help from anywhere.
We are hoping to collect N1.5 billion before the new owners take over its operation. That would mean that we will be able to pay for the cost of electricity, pay our salaries and post some profits.
By the time we succeed in doing these, KEDC will be the first investors’ delight and also be like Ikeja and Eko Distribution Companies that are doing very well.
How prepared are you for its eventual take over by the new owners?
From the strategies we have lined up for this year, we will realise our target. One of our strategies is to bring our services closer to our customers wherever they are and to do that, we have created five additional business units. They include Zaria City, Birnin Gwari, Jaji, Zuru and Kachia business units.
The creation of these units was borne out of necessity to improve the quality of service for our customers. While the quality of service is improving in Kaduna, drastic efforts must be made by management to ensure that the same quality of service is enjoyed in all nook and cranny of the states under our control.
With the additional units, our services will now be closer to the people and our customers will have direct access to members of management at our response and complaint centres. It will be like responding to any form of fault within 24 hours.
We are also going to inaugurate some products for the benefits of our customers. Just like the telecom companies where you buy recharge cards to recharge your phones, our customers can now buy recharge cards with which, from the comfort of their homes and offices, recharge their electricity meter and light becomes available. With this special card, our customers will be satisfied because sometimes when the customers come here, there are long queues. Sometimes as a result of network problem and breakdown in communication, the customers are unable to recharge their meters.
With the introduction of the electricity cards, one can buy the cards and keep in one’s home, in one’s wallet and whenever one runs out of electricity at home, one would recharge one’s meter anywhere there is network service on one’s phone.
The second product we have is also interesting. If one has airtime in one’s handset and one wants to recharge one’s meter with the airtime in one’s phone, one can do that. It is the most interesting product that our customers will enjoy this year. As long as there is power supply, you will not have disruption. In addition to that, we are also introducing web-based recharge system. You can go to our website and log on to the site where you want to recharge your meter and with your ATM card, you can recharge your meter.
This you can do anywhere you have internet service.
We are going to extend our services to ATM in all the banks so that our customers can go to any bank with their ATM cards and recharge their meters. When these products are made available to our customers, quality of service will improve, even as customer’s will derive maximum satisfaction. This, invariably, will improve the revenue base of the company which will help us to realise our targets.
We have a world-class customer service office. It is comparable to any customer care unit anywhere in the world. We hope that before the end of the year or before the hand-over, we would have a banking service here in the office which will serve as a one-stop centre. When that is in place, the customer care unit will take care of customers’ needs till the handover.
These are some of the activities we will embark on this year before the handover to the new owners who we know are waiting. We are ready for them and we believe that they will be happy with the company they have invested in.
You spoke about improved revenue collection, but no mention was made about the debt being owed the company by consumers. Does that mean your customers are up-to-date in their payment?
What we should be more concerned with is the level of improvement in our performance. By January last year when we came in, the response rate to our bills was about 35 per cent. But as at today, we have increased that to 52 per cent which shows that we are making progress.
The debt profile as at today stands at about N40 billion, but it would have been more than this if we had not been able to put things in place to ensure that we get more response from our customers.
Majority of the defaulters are the residential customers who, by consumption, take away about three quarters of our energy. With the new facilities being introduced to help customers pay their bills, we are optimistic that it will be much easier for them to respond to our bills.
With the metering programme currently available, we are confident that prepaid meters are well accepted by customers. We are expecting about 40,000 meters from the World Bank which will be installed in Kaduna. The places to benefit from these meters have been earmarked and the installation of these meters will help us tackle the debt profile of the company.
Recently, you said that the company would need about N5. 7 billion to procure prepaid meters. How far have you gone on this?
The National Electricity Regulatory Commission has come up with a mid-solution. Since the government cannot provide that fund, NERC has said if anyone has money to procure meter on his own account without waiting for free meters from government, the person can pay to certain vendors accredited by NERC and within five weeks, the person will have a new meter.
Currently, that scheme is in place and some customers have gotten their meters in less than four weeks.
So, the issue of metering is left for the customer to decide. That scheme is working and the meters are available because investors have invested in it.
The Kaduna State Water Board has blamed your company for the erratic water supply in the state. How true is this?
Between Kaduna Electricity Distribution Company and Kaduna State Water Board, it is a matter of your word against mine. We know that they have heavy equipment that require constant and regular power supply to power them in order to provide water for customers in every part of the metropolis. Sometimes, due to system fluctuation, we are not able to give them the required energy that can power their machines to provide that service.
We also advised them that if they want to have adequate power supply, they need to run special dedicated high voltage line that will power their equipment. When they were going to buy those equipment, we expected that we will work together so that the angle of power supply for those equipment will be addressed.
During the visit of the Minister of Power to the company last year, you complained that one of the contractors handling the NIPP plants in the zone was not performing. What is the situation now?
I did say that about eight of the projects are suffering from abandonment.
Interestingly, out of those eight projects, the contractors handling three of them are back to site. One of those projects here in Kaduna will be inaugurated soon. That project was one of the eight that I mentioned and once it is inaugurated, it will take care of a large chunk of areas that experience low voltage, load shedding and all kinds of low quality service. This will improve the power supply situation.
