We Lose N30bn Monthly To Vandalism, Theft, Others – Discos
Electricity distribution companies have said they lose over N30bn of their monthly revenue due to cases of energy theft, meter bypass, vandalism and unpaid electricity bills by consumers.
Speaking under the aegis of the Association of Nigerian Electricity Distributors on Thursday, the Discos said over 40 per cent of power consumers do not pay their bills, while indulging in illegal connection of electricity.
The Executive Director, Research and Advocacy, ANED, Sunday Oduntan, said these challenges formed the major part of Discos’ Aggregate Technical, Commercial and Collection losses.
The power firms called for effective legislation against energy theft to safeguard revenues and improve performance in the power sector.
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Oduntan said, “There is a need for effective legislation by the National Assembly to checkmate energy theft in the country as the practice is costing the power sector billions of naira monthly.
“The power sector is currently grappling with a liquidity shortfall of over N1.5tn occasioned by a combination of adverse conditions among which is the high rate of energy theft.”
In a presentation by the Discos during a Senate public hearing earlier this week, the Discos showed an instance where out of the N27.7bn that was billed for energy consumed in 2019 by unmetered customers, only N5.2bn was recovered.
Oduntan said, “On average, each Disco loses about N3bn every month on these challenges and for the 10 Discos who are our members, the monthly losses are over N30bn.”
He said the power firms were working hard to ensure the availability of meters so that there would be greater transparency to build customer confidence.
In another development, the power distribution companies have said the tariff hike scheduled to come into force on July 1 will be based on the hours of electricity supply available to the customers.
The Minister of Power, Sale Mamman, had said last week that the planned increase in tariff which was delayed by three months in April due to the COVID-19 outbreak and customer apathy would take effect next month.
Two of the Discos, Ibadan Electricity Distribution Company Plc and Kaduna Electric, in separate statements on Thursday, informed customers that a new tariff regime would be implemented starting from July 1 in a bid to improve service delivery.
The Chief Operating Officer, IBEDC, Mr John Ayodele, said the objective of the review “is to ensure that IBEDC adjusts its tariff in line with the current economic realities.”
He said, “In order to provide more efficient and reliable service to customers, cost-reflective tariffs are required to cover the cost of critical investment in infrastructures and other parameters necessary for improved service delivery.
“This new tariff design is based on the quantity of power supplied as customers will only pay based on the availability of supply. Those receiving 20 hours’ supply daily will pay more than those getting 10 hours.”
Ayodele said although the firm was very mindful of the challenging economic situation occasioned by COVID-19 pandemic, rising inflation rates and a volatile foreign exchange market compelled the implementation of the new tariff design.
“The tariff review is to reflect macroeconomic indices in Nigeria and the global harsh economic realities facing the power sector,” he said.
He said with the new tariff, IBEDC would be in a better position to roll out more meters, upgrade aging infrastructure and be more responsive to the complaints of its customers.
Kaduna Electric said the new tariff had become necessary to enable all players in the Nigerian electricity supply industry cover the costs of their operations and ensure improved service delivery.
It said, “Under the new tariff band, customers will be charged based on service levels. The more hours of supply they enjoy, the more they are expected to pay for it.”
The company added that the new pricing regime was not all about tariff hike but a deliberate and systematic march towards putting the nation’s power sector on the path to sustainable growth.
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