The Chairman, Board of Directors of Kaduna Electricity Distribution Plc, Barrister Yusuf Hamisu Abubakar, OON has identified microeconomic challenges, regulatory inconsistencies and policy shift as the major factors that have impeded the ability of Distribution Companies to attract the required funding for metering and financing their capital expenditure.
Barrister Abubakar made the assertion in a paper titled; Metering and Power Theft Challenges faced by DisCos in the NESI presented at the just concluded NBA 2017 Annual General Conference in Lagos.
He disclosed that one of the critical malfunctions of the old order which the privatization programme sought to address “was to ensure accelerated reduction in Aggregate Technical, Commercial and Collection losses (ATC&C) within the industry and that there is empirical evidence that shows a correlation between low meter coverage and higher incidence of ATC&C losses”.
The Kaduna Electric Chairman revealed that the anticipated metering commitment of the 11 distribution Companies during the bidding process was over a million and half meters per annum, but regrettably, the total meters deployed are less than a million over the last three (3) years.
According to him, “every capital expenditure to be undertaken has to be provided for in the revenue requirement which is the basis for setting tariff. The total CAPEX provided in the revenue requirement is not sufficient to undertake our metering obligation”.
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The electricity boss who also expressed satisfaction with the efforts being made to bridge the gap in grid metering, however admitted that there remains a huge gap in the level of metering of retail customers, a phenomenon which he described as “one of the major obstacles facing the Nigerian Electricity Supply Industry (NESI)”.
“To engender and sustain stakeholder confidence, everyone must be assured of fair and accurate assessment of supply and consumption. DisCos want to be paid what is consumed and the customers want to pay only what they consume; (only) metering provides this assurance when properly done”, he contended.
He urged policy makers and regulators to cultivate the temperament and the discipline to support initiatives that will attract investments and sustain confidence in the sector, warning that regulatory inconsistency and policy changes when done without consultation and certainty is inimical to business. “Business thrives in an atmosphere of confidence, credibility and predictability”, he further adviced.
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