THE federal government has decided to settle out-of-court the dispute over the N37billion contract for the supply and installation of about three million electricity meters it signed in 2003. Babatunde Fashola, minister of power, works, and housing, said the federal government has also reviewed the contract for an immediate implementation.

He stated that an out-of-court settlement had been secured by the government on the contract, which was awarded during the defunct Power Holding Company of Nigeria, PHCN, but was not executed before the power sector privatisation exercise was concluded in 2013.

According to Fashola, a N119 billion court judgement in favour of the plaintiff was awarded against the government on its failures to execute the contract, adding that the government has negotiated the judgment to allow it go back to execute the contract.

“The government of Nigeria had in 2003 (14 years ago) issued a contract for the supply of three million meters to NEPA/PHCN. That contract was not performed until the privatisation was concluded in 2013, and was inherited by the Buhari government as a court case in which a judgment of N119 billion had been signed against government. We have worked to get the case out of court, negotiate the judgement and go back to the N37 billion contract to see how many meters it can now provide, and how to install them. We are still finalising the terms of agreement,” he said.

Fashola noted that the administration of Goodluck Jonathan made the mistake of failing to make metering of consumers a compulsory obligation of the 11 electricity distribution companies, Discos, in the power privatisation exercise it concluded in 2013, adding that the development was compounded by inaccurate consumer enumeration in the sector.

“One of the omissions of the privatisation carried out by the last administration was lack of compulsory metering before the privatisation. This is compounded by an inaccurate consumer projection of six million households, without a consumer audit. These are the problems the Buhari government is now trying to fix with the power sector recovery programme.”

The minister said for Nigerian electricity consumers to enjoy reliable power supply to their homes and offices, they must accept that tariff charged them by their discos can either go up or down.

He added that consumers should instead of contesting the tariff in courts, demand that meters to observe their consumptions are deployed to their premises by the Discos.

“If we want to experience reliable electricity, we must accept the reality of tariffs and possible upward or downward reviews. We must stop going to court to get injunctions to stop tariff reviews. We don’t do so, when exchange rate, inflation and prices of other commodities change. What we must insist on is the provision of meters, so that we can monitor and control what we consume,” he said.

Fashola also said that the electricity sector privatisation, which the federal government concluded in 2013 has failed to deliver the expected results because of various constraints.

He said at the moment, the government was constrained by many reasons from reversing the privatisation exercise. He, however, noted that he believed in the privatisation of the power sector as a way to solving Nigeria’s power challenges, adding that the 2013 exercise would have to be improved on to meet its original targets.

“Without a doubt, the privatisation of power is the way to go. Admittedly, it has not yet delivered the kind of results we were all made to expect for some of the reasons I have stated; political interference, liquidity, metering, debts, governance, technical capacity of operators and the political dishonesty with which Nigerians expectation were raised to the sky. But I have no doubt at all, having studied the privatisation of Brazil, Mexico, India, South-Africa and China (who went through some or all of our current challenges), that reliable electricity will happen in Nigeria.”

—  Jul 31, 2017 @ 01:00 GMT