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NERC bars DisCos from stakes in new meter companies

…Says customers to pay meter service charge

The Nigerian Electricity Regulatory Commission (NERC) has barred all the electricity Distribution Companies (DisCos), its core investors, subsidiaries, directors and affiliates from holding any shares in the new Meter Asset Providers (MAP) companies. 

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The directive is contained in the MAP Regulation 2018, which grants a 15-year license to Meter Asset Providers (MAP) to help the 11 Distribution Companies (DisCos) speed up meter installation for their customers.

The regulation says the affected officials should not hold directorships and senior management positions in MAP.

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It remains unclear how the commission will monitor the management positions after it has cleared a MAP and issued it with a permit.

Due to absence of a substantive head at NERC for almost three years, MAP Regulation 2018 was signed by the vice chairman, Garba Sanusi, on March 8, 2018, but would not be enforced until April 3, 2018, a document showed.

Daily Trust analyses key features of the regulation, including the introduction of the “Metering Service Charge” for metered customers, barring of DisCos from owning or managing MAP firms, a 30 per cent local content mandate and the need to see more meters rolled out after the next four months (from July 2018).

The Commissioner, Legal, Licencing and Compliance at NERC, Dafe Akpeneye, while presenting the new MAP regulation at a recent 25th power sector meeting in Uyo, Akwa Ibom State, said it would introduce investments of over N200bn in the next three years.

Akpeneye said, “It will also create jobs as we have introduced local content requirements. It is estimated that 30 per cent of all meters deployed must be procured from local manufacturers and assemblers and in two to three years, it will increase to 40 or 50 per cent.”

NERC placed the figure for unmetered customers across the DisCos at 4.740 million by December 31, 2017, which it said would increase after the DisCos concluded their customer enumeration exercises.

“The distribution licensee is responsible for meeting its metering targets as specified by the commission from time to time,” the 28-page regulation also emphasised.

The DisCos, from April 3, 2018, have been directed by the regulation to engage MAPs and conclude the  procurement process within 120 days (four months) to provide meters to the huge “wait list” of customers.

After a DisCo gets a MAP, NERC said it would engage a tender auditor to probe the procurement process.

To qualify as MAP, firms have to apply to NERC with a 10-year business plan along with other documents. “The tenure of MAP Permit shall be 15 years for successful firms in the first instance,” it said, and that it would grant such permit in 21 days of application based on criteria.  

The proposed rule still recognises the 71 Metering Service Providers (MSPs) licensed by NERC in its 2017 updated list. Therefore, MSPs will be engaged by MAP in the metering exercise.

Metered customers to pay ‘Service Charge’

As NERC begins enforcement of the new MAP Regulation 2018 in two weeks’ time, customers who will be metered under the new arrangement will pay what the commission calls ‘Metering Service Charge’.  

The distribution licensees shall include a metering service charge as a clear item on the billing of its customers provided with meters under an MSA with MAPs and shall be separate from the energy charge, it said.

Customers who choose to buy meters can do so through the DisCo, and upon certification of the premises, MAP shall install the meter in 10 working days. Such customer will not pay for meter service charge again, it explained.

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