Tariff: Electricity company seeks 45% duty waiver to install 867,291 meters | Dailytrust

Tariff: Electricity company seeks 45% duty waiver to install 867,291 meters

The Abuja Electricity Distribution Company (AEDC) has urged the federal government to waive the 45 percent import duty imposed on meters to help it attain the installation of 867,291 units by 2022.

The Managing Director of AEDC, Engr. Ernest Mupwaya disclosed this in Abuja during a customer consultation session on the proposed tariff hike in April 2020.

Mupwaya said AEDC deployed 170,239 meters in 2019 and targets installing 330,377 in 2020. It will install 257,373 meters in 2021 and 109,302 in 2022 to close the metering gap in FCT, Kogi, Niger and Nasarawa States.

Mupwaya said: “As at today, we have installed 81,155 meters since the Meter Assets Providers (MAP) started. There is a 45 percent import duty on meters which is reducing the influx of meters along with the low capacity of local companies.”

He urged the customers to join their voices with AEDC so the federal government can reconsider the high import duty on meters, saying with lower rates, the DisCo will flood the networks with meters to ensure accurate power consumption and payment.

He said part of the improvement in AEDC is the purchase of N114 million high technology laboratory vehicle that detects underground cable faults.

He also assured that issues of over estimation will be resolved as the DisCo will spend N1.6 billion to buy bulk power meters and install them across transformers.

Explaining the implication of the new tariff, Mupwaya said customers who consume lower quantity of energy will pay lower tariff.

“For the first time, the DisCo is linking its tariff level to performance. We are saying that we cannot give the same tariff of those with 18 hour supply to those getting 12 hour supply.”

Although the planned tariff rose by 35%, Mupwaya noted that customers on single phase meter will pay 5% less than those on the three phase. “This is because the three phase is more costly to maintain in terms of the cables and fault clearing.”

New tariff

Nigerian Electricity Regulatory Commission (NERC) had, in January, published a reviewed power tariff for December 2019 with no hike for customers of the 11 Distribution Companies (DisCos) until April 2020.

NERC in the published December 2019 Minor Review of the Multi Year Tariff Order (MYTO) 2015 and the Minimum Remittance Order (MRO) for 2020 gave a caveat on the frozen tariff hike.

“The Federal Government’s updated Power Sector Recovery Programme (PSPRP) does not envisage an immediate increase in end-users tariffs until 1st April 2020 and a transition to full cost reflectivity by end of 2021.”

To bridge this gap since customers won’t pay the new tariff till April, NERC, in the Order dated December 31, 2019 and signed by the NERC Chairman, Prof. James Momoh and the Commissioner, Legal, Licencing and Compliance, Dafe Akpeneye, said: “In the interim, FG committed to fund the revenue gap between the cost reflective tariff and the actual tariff NERC allows customers to pay.”


Reps’ position over hike

The House of Representatives directed the NERC to halt the planned increase in electricity tariff.

The directive was given at a public hearing involving relevant stakeholders conducted by the House Committee on Power in January.

The Chairman of the Committee, Magaji Da’u Aliyu, faulted the NERC and Distribution Companies (DISCOs) over the planned hike saying, proper consultation was not conducted before going public.

He said the power sector operators and regulatory agencies would not be allowed to charge Nigerians different tariffs for electricity usage based on locations.

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