Low Demand for Prepaid Meters

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Sam Amadi, chairman, NERC

NEW investors in the power sector are contemplating on ending the Credited Advance Payment for Metering scheme, CAPMS, on account of the low response by electricity consumers. The successful launch of the CAPMS scheme by various DISCOs across the country seems to have hit the rocks, as electricity consumers’ responses have not been encouraging, thereby leading to over production of pre-paid meters by local manufacturers.

Due to the low response, some of the manufacturers lamented that their production capacities had dropped below 50 percent, a development they blamed on the DISCOs, for not doing enough to sensitise the public about the scheme. It would be recalled that the scheme was designed by the Nigeria Electricity Regulatory Commission, NERC, to fill the gap created by the old metering system as contained in the Multi-Year Tariff Order, MYTO II. The operators allege that inadequate funding of the programme led to shortage in the supply of the prepaid meters, thus boosting the continuation of crazy billing. The NERC said the scheme would ensure that electricity customers who were ready to make the advance payment would get prepaid meters within a maximum of 45 days.

For instance, customers could pay N25, 000 for a single phase or N50,000 for a double phase meter. He is expected to get the prepaid meter within 48 hours or a maximum of 45 days. This interval includes days of inspections of where the meter will be installed by the Distribution companies, DISCO. Meanwhile, the NERC said it had already accredited nine pre-paid meter manufacturers, and 15 importers to implement the metering scheme. In addition to the list of manufacturers and importers, are also 38 vendors, 11 individual installers and 61 corporate installers who were also accredited by the Bureau of Public Procurement, BPP, without any objection.

The NERC acclaimed that due process was followed before the final list of certified Vendors/Installers for the CAPMS was made public. However, stakeholders in the sector have argued that importation of pre-paid meters would hinder the growth of domestic manufacturers, stressing that the local content initiative should be allowed to strive in the power sector apart from the oil and gas industry. The implementation of the local content initiative in the sector, according to some experts, requires federal government’s prompt intervention, adding that they are capable of meeting local demand in the country.

Still Erratic Electricity Supply

Chinedu Nebo, Minister of Power
Chinedu Nebo, Minister of Power

ELECTRICITY generation in Nigeria has dropped by 40 megawatts, according to the Transmission Company of Nigeria. The firm said the drop was due to vandalisation of pipelines supplying gas to the Okpai Power Plant in Delta State. The plant, it said, was shut down as a result of the reported acts of vandalism, adding that the development would warrant power rationing across the country for four days. The firm said in a statement signed by Seun Olagunju, its general manager, that repair works on the plant were expected to be completed within three days. “Okpai Power Plant will expectedly resume generation on Wednesday, November 27, 2013.”

A senior official from the ministry of power said that fluctuations in power generation might persist for a while because the new power firms owners’ were still settling down to manage the sector. The official, who wished anonymity, explained that although the recent drop in generation was due to gas pipeline vandalism, most of the investors were yet to fully comprehend how the system works. “We may continue to experience a drop in power and this will lead to poor supply in some areas because the investors are still in the process of knowing how to efficiently run the business. This may take time, but in due course, things will take shape.”

Despite the takeover of power firms by private investors since November 1, the country has continued to experience poor electricity supply. Although the investors have explained that development in the sector would take time, electricity consumers are expecting a quick and positive transformation in the power business. Last week, residents in various states complained that power supply across the country had remained poor. They described this as a source of worry because they expected a steady improvement of the situation with the entry of the private investors. The Presidential Task Force on Power has put the power generation level at 3,600.90 megawatts as at November 20, 2013.

A Step Towards Economic Diversification

NGOZI Okonjo-Iweala, minister of finance, has said that Nigeria has made significant progress in its shift away from oil and enhancing the development of the non-oil sector. But she said that Nigeria must work faster to reduce its dependence on oil for greater economic growth. “Nigeria is one of the fastest growing countries in the world, we just saw third quarter GDP growth of 6.8 percent and we expect to end the year at 6.75 percent and the IMF is forecasting higher growth rate, but we think we need to grow faster. We are making progress [moving away from oil] but we want to do it faster. At one point, 90 percent of our revenues came from oil; so we’re making progress,” she said.

Okonjo-Iweala
Okonjo-Iweala

Nigeria’s oil reserves, production and exports generate around 70 percent of the government’s revenues, but Okonjo-Iweala said the country had many untapped growth opportunities it needed to explore in order to maintain a high growth rate. Agriculture, which accounts for 40 percent of Nigeria’s economic output, and the housing and manufacturing sectors were “still largely untapped” sources of growth. “We have a demand for 70 million housing units that are unfilled, so there’s certainly a possibility there and, of course, that creates jobs for carpenters and plumbers and all the linked sectors.”

She noted that manufacturing could thrive given Nigeria’s huge domestic market and population of 170 million. The minister further said that the government was aware of the need to create more jobs for young people and wanted to make the labour market “inclusive.” She added that the government was implementing reforms in the energy and agricultural sectors, which would help Nigeria maintain its high growth rate. “I think with that progress, you will see improvement in the power sector and that will allow small and medium-sized enterprises and households to benefit and the economy to move much better.”

Compiled by Anayo Ezugwu 

– Dec. 9, 2013 @ 01:00 GMT

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