Ekiti electricity regulator threatens to sanction DisCos

The Ekiti State Electricity Regulatory Bureau has threatened to sanction the Ibadan Electricity Distribution Company and the Benin Electricity Distribution Company over failure to report power supply shortfalls.

The bureau recently issued an order on tariff setting for Ekiti customers under BEDC and IBEDC service areas in Ekiti State and another order on mandatory metering of customers by the Discos and the meter asset providers.

In the orders, the regulator threatened to impose heavy fines on the two DisCos if they failed to publish shortfalls whenever they could not provide the minimum hours of electricity required of them for customers in all Band A to E.

It said there would also be sanctions if the metering of customers was not taken as a priority.

The bureau recalled that the Nigerian Electricity Regulatory Commission, which transferred regulatory power to it, had continued to issue multi-year tariff orders to the DisCos.

In light of the orders ceding regulatory oversight of the Electricity Market in Ekiti State from NERC to the Ekiti Electricity Regulatory Bureau effective May 1, 2024, the bureau ordered that tariffs within the state shall henceforth conform with NERC-specified electricity tariffs until further notice, or until MYTO rates are abolished nationwide, whichever comes first.

EKSERB said it reserved the right to change those tariffs in tandem with NERC rates or set its rates in consultation with relevant parties, stating that the service delivery commitments of the orders will continue to apply.

“In addition, each distribution company shall electronically provide to EKSERB a daily log of the power (in Kilowatts or Megawatts) and the number of hours of availability on all the Feeders in its distribution network,” it noted.

The order mandates the two DisCos operating in Ekiti to ensure customers on Band A to E get the minimum hours of electricity according to the band they belong to while the DisCos must publish shortfalls on their websites for all customers.

“The distribution company shall ensure that the minimum Band hours for any given band stipulated shall be delivered daily and shall publish shortfalls on its website on a daily basis. For postpaid customers, shortfalls on any given day shall result in energy costs being calculated at the appropriate band rate. For prepaid customers, shortfalls on any given day shall result in credits being given to them in the following month by calculating the energy to be paid at the appropriate band rate,” the bureau said.

It warned, “Failure to publish such shortfalls, to revise energy costs or to credit customers, accordingly, shall attract a sanction of equal to five times the total credit due.”

On metering, the EKSERB, in an order signed by its Executive Secretary, Dare David and the Director of the State Electricity Management Services Department, Adewale Adeniyi, directed DisCos to discourage the estimated billing method and ensure that all new customers are provided with smart prepaid or postpaid meters.

The bureau also directed them to henceforth accept certified smart meters which must be purchasable by customers directly from meter asset providers duly registered with the agency.

The DisCos were directed to start mandatory metering of electricity customers with effect from June.

The bureau explained that the order was issued to address the recurring issue of arbitrary and outrageous electricity bills majorly caused by the estimated billing method imposed on unmetered customers by the DisCos.

“This type of electricity billing method has discouraged many customers from paying for monthly electricity consumption, resulting in loss of revenue for the distribution companies and loss of confidence on the part of electricity consumers.

“Licensed Meter Asset Providers may sell directly to eligible electricity customers in the state and must provide and install these meters within ten working days of payment to their MAP-designated bank accounts. Failure to install these meters shall draw a fine not exceeding the cost of these meters multiplied by each day not installed after payment,” it stated.

Meanwhile, An expert in the electricity industry, Bode Fadipe, claimed that the orders would scare away prospective investors.

In an interview with The According, Fadipe stated that the effectiveness of a law does not depend on how draconian it is, but on how realistic it is.

“By spitting this amount of fire, Ekiti State Electricity Regulatory Bureau is making the business environment more hostile and less attractive for prospective investors,” he stated.

Speaking on the penalty for the fixing of meters outside the prescribed deadline of 10 days and the connection to the back-end facility of the DisCo outside the prescribed period of five days, Fadipe argued that the penalty was too high even though the purpose was to incentivise swift compliance and save the end users the horror associated with metering.

“The bureau cannot in one breath direct that end users should buy meters directly from licensed MAP and at the same time order the DisCos to eliminate estimated billing. By allowing end users to get their meters directly, the pace of metering is now determined by the end user and not the DisCo. It is the time the end user brings his meter that the end user is connected to the grid.

“Where the end user does not provide a meter, the implication of this Order is that the DisCo should not connect such a customer. Not that alone, all existing customers/end users who are yet to be metered should be disconnected in order to avoid a breach of the Order of the Ekiti Electricity Regulatory Bureau,” the expert pointed out.