NERC to Increase Prepaid Metre Prices Again Amid Naira-dollar Fluctuations
- The power regulatory agency in Nigeria is considering an upward review of the cost of metres in the country
- This means Nigerians will now pay more to purchase metres, even though there was a similar upward review a few months ago
- Metre manufacturers claim increases in operational expenses and currency fluctuations are responsible for the price surge
Legit.ng journalist Victor Enengedi has over a decade's experience covering energy, MSMEs, technology and the stock market.
The Nigerian Electricity Regulatory Commission (NERC) is reportedly considering raising the already adjusted metre costs due to escalating production expenses for manufacturers.
According to sources familiar with the situation, NERC is contemplating a significant shift by potentially deregulating metre pricing, allowing manufacturers to independently set their prices rather than maintaining current regulatory controls.
Source: UGC
The move is expected to not go down well with customers given that it was only a few months ago that NERC approved the upward review of the prices of pre-paid power metres in the country.
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The increase had forced customers to protest, accusing the NERC of becoming anti-consumer and favouring operators to the detriment of consumers.
DisCos prepare for imminent meter price increase
According to BusinessDay, the sources who preferred to remain anonymous also indicated that metre manufacturers have ceased issuing invoices to electricity distribution companies (DisCos) in anticipation of NERC's decision on a substantial upward price review.
Furthermore, manufacturers face increased costs from currency fluctuations and inflationary pressures, complicating efforts to sustain current prices.
Meanwhile, a representative from one of the DisCos mentioned that new meter applications are currently on hold, citing expectations that NERC will announce revised pricing soon.
The source added that applications will resume processing only after the new pricing structure is disclosed, leaving numerous applicants without access to prepaid meters.
He said:
“The cost of prepaid meters is going to go up soon. Meter Asset Providers have stopped selling new meters as they await NERC to approve new prices.
“New meter applications are not being processed until the price changes are reflected. So due to FX issues, the meter manufacturers have stopped sending invoices until the meter price is reviewed.”
The NERC has sanctioned the pricing of prepaid metres, many of which are brought into the country as semi-knocked-down units and assembled domestically for deployment.
Also, prepaid metres have undergone advancements, with DisCos integrating functionalities to prevent energy theft and offer more detailed consumption data.
Nigeria currently faces a metre deficit exceeding 7 million units, resulting in most customers being billed based on estimations rather than actual usage.
Wale Ogundeji, energy analyst, told Legit.ng that increasing the cost of prepaid metres will affect the government's effort at closing the metering gap in Nigeria.
He said:
"Given the current economic hardship, raising the prices of metres will make it difficult for more Nigerians to acquire one. The price is already too high for many Nigerians to afford, hence many consumers are still on estimated billings.
"When metres become unaffordable, consumers will shun the purchase and then further widen the metre gap that the federal government has been trying for years to close up."
FG launches new metre factory in Nigeria
In related news, Legit.ng reported that the federal government has launched an electric energy metre factory to produce 1.4 million meters yearly.
Vice President Kashim Shettima commissioned the manufacturing factory in Oraifite, Ekwusigo Local Government Area of Anambra State.
Shettima said that the development would help close the metre shortage gap in the country and drive growth in the energy sector.
He claimed that the factory's construction would assist in resolving the nation's problems with electricity supply.
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Source: Legit.ng
