7m meter gap: NERC approves N21bn for DisCos


From Isaac Anumihe, Abuja

Following the inability of the distribution companies (DisCos) to close the metering gap of over 7 million unmetered customers, Nigerian Electricity Regulatory Commission (NERC) has approved N21,000,000,000 to be apportioned pro rata to the DisCos.

In a document released by NERC, at the weekend, the regulatory agency bemoaned the inability of the distribution companies to raise financing in the form of debt
or additional equity, saying that it was the major constraint in the acquisition and
deployment of end-use meters and other capital investments.

“The Meter Acquisition Fund
{“MAF”) scheme was therefore developed and approved by the commission, primarily to
address the challenge of DisCo creditworthiness inhibiting the deployment of end-use
meter in Nigerian Electricity Supply Industry (NES|) by creating a credible revenue stream from the market funds on the back
of which long term financing may be secured by the utilities” NERC, said.

To this effect, NERC has ordered the distribution companies to utilise the first tranche {“Tranche A”) of disbursement from the MAF
scheme based on contributions made by DisCos as at the April 2024 market to, among others, procure and install meters for
unmetered Band ‘A’ customers within their franchise areas.

“DisCos shall, within 14 days from the effective date of this order, conduct a transparent and competitive procurement process, for meter price determination,
selection and engagement of Meter Asset Providers MAPs/LMMAs for the metering of end-use customer
meters under the MAF scheme” the commission said.

The report, according to the commission, shall contain, a report containing details of the process undertaken for the selection of
MAPs/LMMAs, including meter price, meter specifications, and the list of customers
to be metered.

These, according to NERC, shall be sent to the commission for approval, within 20 days
from the effective date of the order.

“Upon approval of the commission, the DisCo shall enter into contracts with selected MAPs/LMMAs on one of the following terms:
(i} Where an Advance Payment Guarantee (“APG”) issued by a commercial bank
in Nigeria is provided by a qualifying MAP/LMMA, 30 per cent of the contract sum
shall be paid to the MAP/LMMA upon
execution of the contract.

“A further two milestone payments shall be made
upon the completion of 60 per cent of contracted quantities and 100 per cent of the contract
respectively, with the funds advanced against bank guarantee amortised over
the payments.

“Where the MAP/LMMA do not request an advance payment, the milestone
payments shall be made upon the verified installation of 20 per cent, 60 per cent and 100 per cent
respectively of the contracted volume of meters” the agency, said.


Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button