“More bark than bite” suggests that the Nigerian Electricity Regulatory Commission (NERC) makes loud noises and threats, but lacks the effectiveness and enforcement powers to back up its words. NERC is responsible for regulating the electricity industry, including the Distribution Companies (DisCos). However, many stakeholders, especially consumers, have expressed frustration with the commission’s effectiveness in regulating the DisCos.
As the regulatory body responsible for overseeing the electricity sector, NERC’s inability to effectively address this issue raises serious questions about its effectiveness and commitment to protecting consumer interests.
NERC has received numerous complaints from consumers about outrageous billing, yet the commission has not taken decisive action to address these concerns. NERC lacks effective enforcement mechanisms and has and failed to deliver on promises while the DisCos continue to engage in outrageous billing practices.
Outrageous billing occurs when the DisCos bill consumers based on estimated energy consumption rather than actual meter readings. This led to inaccurate and inflated bills, causing financial hardship for consumers. However, owing to the outrage over estimated energy billing system, the DisCos surreptitiously changed the name to REAL Energy Consumption to give the electricity bill a semblance of real consumption. The DisCos found a way to circumvent the statutory regulation to the financial detriment of its customers.
The DisCos have cleverly changed the Estimated Billing system “Units of Electricity Consumed” without NERC raising an eyebrow. The questions naturally arising from this new billing system is: how have the DisCos arrived at the ‘Units of Electricity Consumed’? How does Ikeja Electric, for example, calculate the units of electricity consumed by its customers without pre-paid meters? What is the basis of the electricity calculation?
Take for instance, this writer’s experience. I live in Owode-Onirin area of Lagos State and had a pre-paid meter from April 2021 to April 2024. Thereafter, the meter became faulty, although there were still unused units in it. During that period, I was loading an average of N7,000 per month as a single owner-occupier user. Ikeja Electric was contacted about the fault and its staff came to remove the meter with a promise to repair/replace it within a month. However, instead of repair/replacement, Ikeja Electric started sending me a monthly bill of more than N38,000. Among the items on the bill for December 2024, for example was ‘Consumption – 576.00, Current Charges – N38,687.60.’
Why does Ikeja Electric arbitrarily increase the consumption to 567 units without an explanation of how it arrived at that figure? At age 71, why does Ikeja Electric make it financially difficult for me and the masses to pay our electricity bills?
Why is it so difficult for a government that is supposed to be committed to good governance and welfare of the masses to be so insensitive to this exploitation by the DisCos? This is legalized daylight robbery where consumers are forced to pay units of electricity they did not consume. Why does Ikeja Electric carry out this exploitation of its consumers?
For example, it supplies a particular transformer with say, 50,000 units of electricity in a month. At the end of that month, it deducts the consumption of those with pre-paid transformers, the rest of unconsumed units are shared/distributed to those without pre-paid meters, whether they consumed it or not. This does not take into account the many periods of power outages.
There are many reasons why acquisition of prepaid meters is not in the interest of DisCos like Ikeja Electric. First, DisCos benefit from estimated billing now labelled consumption without any calculation, which allows them to charge consumers for electricity they have not consumed. On the other hand, prepaid meters eliminate estimated billing, reducing Discos’ revenue.
Secondly, there is over recovery of revenue: with post-paid meters, DisCos can over-recover revenue from consumers due to inaccurate and blind billing. Prepaid meters prevent this over-recovery. Thirdly, increased transparency: Prepaid meters provide consumers with real-time information about their energy consumption, making it harder for DisCos to charge inflated rates or engage in other exploitative practices such as overbilling. By not promoting prepaid meters, DisCos can maintain their current revenue streams and continue to benefit from outrageous billing and other practices that may not be in the best interest of consumers. It is now virtually impossible to obtain a pre-paid meter through the normal channels. As we speak, there are gangs of Disco staff roaming about communities disconnecting the electricity of those who cannot pay the outrageous estimated bills.
Disconnection of electricity supply due to non-payment of bills is a disturbing and persisting practice in areas controlled by Ikeja Electric. On a daily basis, we see gangs of Ikeja Electric staff in branded pick-up trucks disconnecting lights of consumers who cannot pay the high estimated bills. However, when customers are being billed outrageously due to estimated billing, disconnection can be particularly harsh. We never imagined that with the advent of pre-paid meters, the Discos will still be going about disconnecting electricity from the houses of their customers. This is unacceptable. When the Ikeja Electric staff were confronted, they responded by saying that they were under pressure to collect revenue in respect of electricity ‘supplied’ but not paid for. This was a common practice in the era of NEPA that we thought ended with the advent of pre-paid meters. What we are now witnessing is ‘jungle justice’ whereby Ikeja Electric charges outrageous bills and proceed with brutal force to disconnect electricity if the customers cannot pay. In this arena of high petrol and diesel costs, which consumer would not succumb to this kind of pressure? What is NERC doing about these high-handed tactics and rip-off?
What is the purpose of NERC if it cannot protect consumers against the discos?
That’s a critical question. NERC was established to regulate the electricity industry, including the Distribution Companies (DisCos) but many people are not satisfied with its performance. The purpose of NERC include: Protecting consumer interests – ensuring that consumers receive safe, reliable, and affordable electricity; Promoting competition – encouraging competition in the electricity market to drive efficiency and innovation; regulating industry practices and setting and enforcing standards for the generation, transmission, and distribution of electricity and to protect consumers against the greed of the DisCos.
NERC can also use regulatory measures to protect consumers. It can establish and enforce strict regulations to prevent DisCos from engaging in exploitative practices, monitor tariffs to ensure they are fair, reasonable, and reflective of the actual cost of electricity.
•Adeniran is a chartered insurer and management consultant. He writes from Lagos.
