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Power Firms Face Huge Fine for Overbilling Customers

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The Nigerian Electricity Regulatory Commission (NERC) has announced that it will impose a hefty penalty on 11 power distribution companies (Discos) for overcharging their unmetered customers in 2023.

According to a notice issued by NERC on Friday, the Discos failed to comply with the monthly energy caps issued by the commission, which aimed to align the estimated bills for unmetered customers with the measured consumption of metered customers on the same supply feeder.

The notice stated that “a review of the electricity distribution companies’ billing of unmetered customers for 2023 has revealed non-compliance with the monthly energy caps issued by the commission.”

As a result, NERC said it will deduct a sum of N10,505,286,072 from the annual allowed revenues of the 11 Discos during the next tariff review, to deter future non-compliance with the energy caps approved by the commission.

The commission also ordered the Discos to issue credit adjustments to all over-billed unmetered customers for the period January to September 2023 by the March 2024 billing cycle.

In addition, the Discos were directed to publish the list of credit adjustment beneficiaries in two national dailies and on their website not later than March 31, 2024.

The notice further warned that any Disco that fails to comply with the order will face further sanctions, including suspension or revocation of its license.

Why customers are unhappy with Discos

The issue of estimated billing has been a major source of complaints and dissatisfaction among electricity consumers in Nigeria, who accuse the Discos of exploiting them with exorbitant and arbitrary charges.

Many customers have been clamoring for prepaid meters, which they believe will ensure fair and accurate billing, as well as reduce energy theft and losses.

However, the Discos have been unable to meet the demand for prepaid meters, citing various challenges such as funding, logistics, vandalism, and sabotage.

According to NERC, as of June 2023, only 37.8% of the total registered electricity customers in Nigeria had been metered, leaving 62.2% or 6.52 million customers on estimated billing.

The commission said it introduced the capping of estimated bills in 2020 to protect unmetered customers from inflated charges and to incentivize the Discos to expedite the metering process.

However, the latest order by NERC shows that the Discos have not fully complied with the capping order, and have continued to overbill their customers.

How customers can benefit from the order

The order by NERC is expected to bring some relief and compensation to the affected customers who have been overbilled by the Discos.

The commission said it will monitor the implementation of the order and ensure that the Discos comply with the credit adjustments and the publication of the beneficiaries.

The order also serves as a warning to the Discos to improve their billing practices and metering services or face further sanctions from the regulator.

The commission urged customers to report any Disco that fails to comply with the order to its forum offices or consumer complaints units in their respective states.

NERC also advised customers to pay their bills promptly and avoid tampering with or bypassing the meters, as this constitutes an offense punishable by law.

The commission said it remains committed to protecting the rights and interests of customers and ensuring the sustainability and improvement of the electricity industry in Nigeria.

Source: Punch

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