Power: Concerns over govt’s move to end ‘crazy’ billing

On May 1, the Meter Asset Providers (MAPs), a scheme by the Federal Government to end crazy billing, began operation. Assistant Editor EMEKA UGWUANYI x-rays the initiative.

The Meter Asset Provider (MAP) Regulation, which came into force on April 3, 2018, enabled the creation of the Meter Asset Providers (MAPs) – a new set of service providers, to fast-track the closure of the metering gap currently affecting over five million customers in the Nigeria Electricity Supply Industry (NESI). Besides, the metering scheme will ensure that electricity customers only pay for what they actually consume.

According to the Head, Public Affairs Department of the Nigerian Electricity Regulatory Agency (NERC), Dr Usman Abba Arabi, under the MAP regulation, customer classes shall be amended to ensure that customers only pay for meters when a meter is physically installed in their premises. But at stakeholders’ meeting held in Lagos, NERC said the MAP licensee must meter the customer not later than 10 working days after such customer has paid for the meter. “Rollout of meters shall commence no later than the 1st of May 2019.  Customers of DisCos should expect from the commencement of rollout date for meters to be installed in their premises within 10 working days of making payment to MAPs in accordance with section 18 (3) of the MAP Regulations 2018,” the Commission said.

The electricity bill of customers provided with a meter under the new regulatory framework shall comprise of two parts – energy charge and metering service charge. The payment of metering service charge will be removed from the customer electricity bill upon the full amortisation of the meter asset over its useful life. All faulty meters are expected to be repaired or replaced free of charge within two working days, except in instances where it is established that the customer is responsible for the damaged meter.

In pursuit of promoting local content, the new MAP regulation mandates the investors to acquire a minimum of 30 per cent of their metering volume from indigenous meter manufacturers. This local content threshold may be adjusted by the NERC from time to time in line with the verified manufacturing volume of local manufacturers, he said, adding that the 11 electricity distribution companies (DisCos) are expected to engage the services of MAPs towards the achievement of their three-year metering targets prescribed by the Commission. In other words, the MAP scheme is programmed to completely meter all unmetered customers within three years.

The performance of Meter Service Providers shall be governed by the provisions of the Meter Asset Regulation, technical codes of the electricity industry, and a Meter Services Agreement/Service Level Agreement signed with the distribution companies.

Arabi also stated that the NERC, in line with the powers drawn from the MAP Regulations, in May 2018, approved 22 firms to participate in the meter procurement process but noted that the approval of these 22 companies does not foreclose other interested applicants from getting the NERC’s ‘No Objection’ as it is a continuous exercise.

He said: “The Commission, having conducted due diligence on the supporting documents to the applications submitted by interested investors, has granted successful applicants ‘No Objection’ to participate in the procurement process for meter assets provision in accordance with section 8 (4)  of the Meter Assets Providers Regulations, 2018.

“Companies granted ‘No Objection’ include Huawei Technology Company Nigeria Limited; Bilview Energy Limited; Chintech Electro Nigeria Limited; Holley Metering Limited; Meron Nigeria Limited; Integrated Power Limited; MBH Power Limited; Trimani Engineering Limited; Sapropel Energy Resources Limited; Megawatt Distribution International Limited; Unistar Hi-Tech Systems Limited; and MOMAS Electricity Meters Manufacturing Company Limited.

“Others are Imperial Infrastructure Development Company Limited; Ratio Consulting Limited; Protogy Global Services Limited; Paktim Metering Nigeria Limited; Sabrud Consortium Nigeria Limited; Tinuten Nigeria Limited; Kayz Consortium Limited; BTS Power Limited; CIG Metering Assets Nigeria Limited and Cresthill Energy Limited.”

The Nation, however, learnt that currently, the number of companies that have gotten NERC’s ‘No Objection’ to participate in MAPs has risen to about 36 including, Armese Consulting Limited, Chris Ejik International Agencies Limited, Mojec International Limited, CWG Plc, Integrated Resources Limited, Consolidated Infrastructure Group Limited, FLT Energy System Limited, G-Unit Engineering Limited, Inlaks Power Solution Limited, Turbo Energy Limited and New Hampshire Capital Limited.

The General Manager, Finance and Management Services, NERC, Abdulkadir Shettima, told The Nation that the MAP Regulation mandates electricity distribution companies to engage meter assets providers who fund purchase, installation and replacement of meters to meet DisCos metering obligations to their customers. This is to ensure that all electricity customers are metered thereby reducing incidences of estimated electricity billing to the barest minimum.

According to him, the DisCos through a competitive process will select the meter service provider/s of their choice. The regulatory agency, however, ensures that such MAP licensees’ companies do not have any affiliation or relationship to the DisCos that they will work with. Besides, NERC hired best-qualified auditors that checked the books of bidders (MAP licensees) that bid to participate in a metering scheme to ensure they (licensees) have financial and technical competencies, Shettima added.

He also noted that the DisCos are mandated by the MAP Regulation to embark on a robust sensitization programme of the customers through the media – print, radio, television, social media and the use of flyers, among others. The MAP Regulation directed the DisCos to publish the names of their Meter Service Providers in two national newspapers. The sensitisation programme will make customers know the MAP licensees that will serve them. The sensitization programme will also let the customers know the meter deployment plan and what the customers are supposed to do.

Shettima stated that contrary to rumours making the rounds that DisCos are expressing lukewarm attitude to complying with the publication of their successful MAP licensees and other information the customers ought to know, DisCos must as statutory obligations comply fully with the sensitization programme or face financial sanctions.

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On the cost of the meters to be installed by the MAP licensees, which is fixed at N36,991.50 for single phase meters and N67,055.85 for three-phase meters respectively, he said the Commission didn’t just fix the prices from nowhere. According to him, out of the 36 successful bids received, the NERC selected the six lowest prices, got the average and that is how we arrived at the prices of the meters.

“MAPs shall charge an upfront amount of N36,991.50 for single phase meters and N67,055.85 for three-phase meters respectively. These costs of meters are inclusive of supply, installation, maintenance and replacement of meters over its technical life,” the Regulation stipulated. The Commission shall monitor closely the rollout plan of distribution licensees and overall compliance with the regulation and various service agreements by the MAP and electricity distribution licensees, it added.

DisCos and their MAPs’ licencees

In line with Section 4(3) of the MAP Regulation 2018, which requires all the DisCos to engage MAPs that would assist as investors in closing the metering gap and thus eliminate the practice of estimated billing in the Nigerian Electricity Supply Industry, NERC has issued permit to the following DisCos to work with these MAPs.

Ikeja Electric – Mojec International Limited, which will supply 399,790 meters, Consolidated Infrastructure Group Limited – 397,922 meters and New Hamshire Capital Limited – 276,699 meters.

Benin Electricity Distribution Company – FLT Energy System Limited, G-Unit Engineering Limited, Inlaks Power Solution Limited, Sabrud Consortium Nigeria Limited and Turbo Energy Limited to provide meters within its franchise.

Port Harcourt Electricity Distribution Plc – Armese Consulting Limited and Holley Metering Limited

Yola Electricity Distribution Company – Chris Ejik International Agencies Limited

Enugu Electricity Distribution Company Plc – Mojec International Limited

Ibadan Electricity Distribution Company Plc, appointed CWG Plc, Integrated Resources Limited, Mojec International Limited, Momas Electricity Meters Manufacturing Company Limited, New Hampshire Capital Limited, Protogy Global Services Limited and Tinuten Nigeria Limited respectively to provide meters within their respective franchise under MAP.

Rights of DisCos

Pursuant to the provisions of the metering code, meter reading, billing and collection regulations, the DisCo shall have access to customer meters installed by the MAP, will have right to use data derived from customer meters for monitoring, billing planning and any other related activities.

It will have the right to query data from customer meters for audit purposes and evaluating consistency, accuracy and integrity. The DisCo shall treat cases of unauthorized access and meter tampering in accordance with existing laws and Regulations.

The DisCo shall include a metering service charge as a clear item on the billing of its customers provided with meters under a metering service charge (MSA) with MAPs and shall be separate from the energy charge. The metering service charge shall be based on the outcome of the procurement process for the MAP and subject to the approval of the Commission.

Obligations of DisCos

To develop a meter deployment plan towards the achievement of its metering targets stipulated by the Commission. *Plan and execute a transparent and competitive procurement process for the engagement of MAPs that will supply and install meters within their franchise area. *Execute a Metering Service Agreement with successful MAPs for the deployment of meters based on the DisCo’s meter deployment plan.

*Provide a payment structure and security acceptable to the MAP in line with the terms of the MSA.

*Provide relevant information to the MAP in a timely manner to enable it to carry out its obligations under the contract. *Timely disbursement in full to MAPs the aggregated metering service charge paid by all customers supplied with meters under an MSA.  *Liability for the payment of applicable metering service charge for customers affected by a prolonged service outage exceeding two weeks. *The metering service charge paid by all customers shall be ring-fenced in a dedicated account for the purpose of timely payment to MAPs.

Rights of the MAPs

*Legal ownership of the meter asset until fully amortized through the payment of a metering service charge by beneficiary customers. *Right to be paid in full the aggregated metering service charge paid by customers during the billing cycle. *Access to customer premises to enable it to carry out its operations with respect to the meter asset in compliance with the metering code, meter reading, billing and collection regulations and any other applicable regulation of the Commission. *MAPs shall be granted access to viewing rights to the vending platform associated with meters asset supplied under the MSA.

Obligations of MAPs to DisCo

*Conformity with all specifications for the meter asset and the standard of installation. *Obtain all necessary certifications and approvals for meters in line with extant codes, regulations and industry requirements. *Engage only certified meter service providers for the deployment of meters in line with the provisions of the MSA.

MAPs’ obligations to customers

*Periodic inspection of meters to ensure integrity and reading accuracy. Where required, the MAP shall arrange for the testing and calibration of customer meters in line with the provisions of the metering code. *The MAP shall repair or replace faulty meters within two working days of being notified of such faults. *Where a MAP fails to repair or replace a meter within two working days of a report by the customer or DisCo, the customer shall not be liable for the payment of metering service charge for the billing period unless such delays were as a result of inaccessibility to the customer’s premises.

*In the event of a prolonged delay in repairing or replacing a defective meter asset, the DisCo and MAP shall agree on an appropriate compensation to the DisCo for loss of revenue. *The MAP shall perform its obligation to customers according to service standards set out in a Service Level Agreement (SLA) with the DisCo.

MAPs’ Key Performance Indicators (KPIs)

*A Service Level Agreement shall be executed between the MAP and DisCo to provide for Key Performance Indicators (KPIs) for the MAP. The scope and responsibility for meter maintenance activities and revenue protection shall be as agreed between the parties under the MSA/SLA. The KPIs agreed between the parties to the SLA shall be filed with the Commission. The provisions of the Meter Reading, Billing and Collections and the Metering Code shall be the basis for benchmarking.

Customers’ rights

*All customers are eligible for the installation of an appropriate meter to accurately determine energy consumption and to provide for energy accounting. In line with the provisions of the Metering Code, a customer’s meter shall be repaired or replaced by the MAP within two working days.

*A customer’s meter shall be repaired or replaced at no additional cost within the amortization period of the asset unless the damage was as a result of the willful action of the customer. Where there is a dispute on the responsibility for the damage of a meter asset, the customer has a right to fair resolution in line with the Metering Code and other applicable Regulations and the MAP shall provide a meter pending the resolution of the dispute.

*Where it is established that the customer willfully damaged a meter, the MAP shall replace the meter based on upfront payment by the customer or other mutually agreed terms of payment.

*Where the MAP is unable to provide a replacement meter within a billing period, an average of the last three months billing/vending shall be applied for the purpose of determining customer’s energy consumption.

*Where a customer relocates within the franchise area, the customer shall apply to the DisCo for the transfer of services including applicable credits for energy.

Customers’ obligations

*The customer shall provide access for the provision of meters for their premises in line with the installation requirements of the DisCo. A customer shall be denied service by a DisCo on account of refusal to allow for the installation of a meter by a MAP.  *The customer shall ensure the safety of the meter and shall not tamper with or remove it, nor permit access thereto except by duly authorized MAP staff or agents of the MAP or DisCo.

Upon the installation of a meter by a MAP, the customer has no obligation to pay for metering service charge through the DisCo at the time of payment for energy unless financed upfront in full by the customer. The payment for metering service charge by the customer to the MAP shall cease upon full amortization of the meter asset over its technical life assumed in the procurement process for the MAP.

*Where a customer fails to pay for a metering service charge in any given month or months, the cumulative metering service charge shall be deducted upon the subsequent payment.

*In line with guidelines for asset enumeration by DisCo, customers’ meters are associated with feeders and distribution transformers and shall not be moved by customers.

Customers’ financing of meters

*Where a customer elects to pay for a meter asset upfront under these Regulations, such a customer shall not be liable for the payment of metering service charge through the DisCo.

*The amount payable to the MAP by a customer electing to pay upfront shall be the efficient cost of the meter asset and its installation cost as determined by the procurement process for the MAP conducted by the DisCo.

*The MAP shall install the meter at the premises of the customer within 10 working days of the receipt of full payment by the customer. The authorization by the DisCo to pay for the meter shall only be issued after certifying the readiness of the premises for a safe and secure installation of the meter asset

Cost structure

*The cost structure of Metering Service Charge covers the cost of providing the meter asset and the ongoing costs of operating and maintaining the meter. The cost structure provides a transparent way of billing metering costs so that Customers only pay for own metering services.

MAPs licensees, DisCos and local manufacturers to work mutually

The MAP regulation made provision for local content policy in order to guarantee and strengthen the government’s resolve to encourage the participation of local entities in the sector. Section 9 of the Regulations stipulates that MAPs shall source a minimum of 30 per cent of their contracted metering volumes from local meter manufacturing companies in Nigeria. It noted that further changes to the minimum local content thresholds shall be as specified in the Nigerian Electricity Regulatory Commission (NERC) Local Content Regulations.

“This position taken by the Regulation is highly commendable as the participation of the local business entities in critical sectors of the economy is vital in increasing the capacity, sustenance and localization of technical knowledge of the sector and minimizing the appropriation of crucial resources that would have been spent to import such services,” NERC said.

The Chairman of Momas Electricity Meter Manufacturing Company Limited (MEMMCOL), Kola Balogun, told The Nation that all the stakeholders in the MAP metering scheme – DisCos, MAP licencees and local meter manufacturers will work mutually. However, he noted that local meter manufacturers have the capacity to supply 70 per cent of the entire metering gap and that NERC should increase the 30 per cent local content provision in the Regulation to 70 per cent.

Customers’ sensitisation programme

The DisCos, for instance, Abuja DisCo and Ikeja Electric, have begun to sensitise their customers through radio programmes, distribution of flyers and issuance of press releases.

The spokesman of Ikeja Electric, Felix Ofulue, issued a statement on frequently asked questions on MAP.

He said: “These are companies licensed by the Regulator to procure and install meters for customers of electricity distribution companies. Ikeja Electric will commence MAP in May 2019.  In line with NERC regulations, customers are expected to pay for meters. The payment for the meter by the customer can either be upfront or in instalments.  A single-phase meter costs N38,850 and a three-phase meter costs N70,350. These are all inclusive of VAT. Customers who cannot afford to pay for their meters upfront can pay in instalments. The instalment payment is by regulation referred to as the Monthly Metering Service Charge (MSC) and will continue until full amortization of the meter asset cost, as agreed with the MAPs.”