NERC’s new meter pricing sparks divergent opinions among industry and consumers 

On September 6, 2023, the Nigerian Electricity Regulatory Commission (NERC) announced a revised cost structure for the purchase of meters under the Meter Asset Provider (MAP) program.

Notably, the new pricing scheme excludes Value Added Tax (VAT).

The cost of single-phase meters has been raised from N58,661.69 to N81,975.16, while the price for three-phase meters has jumped from N109,684.36 to N143,836.10. 

According to NERC, this price adjustment is authorized by Section 226 of the Electricity Act 2023 and Section 8(1) of the MAP & NMMP 2021 regulations.

These legislative frameworks empower the Commission to regulate and set the pricing for both single-phase and three-phase meters distributed by MAPs, taking into account all relevant costs and warranties. 

NERC explained that the adjustment was made in response to changes in foreign exchange rates. The objective is to avoid potential shortages of meters, in line with the Commission’s commitment to phasing out estimated billing practices.

NERC emphasized that a significant portion of the components used in meter production is imported, making their costs highly susceptible to fluctuations in foreign exchange rates. 

To accommodate the rising dollar rates, NERC approved the price modification.

This is aimed at ensuring that Meter Asset Providers can recover the reasonable costs associated with meter procurement and maintenance. At the same time,

NERC is committed to upholding a pricing framework that guarantees a sustainable return on investment (ROI) for MAPs. 

This comprehensive price adjustment aims to address several challenges simultaneously.

First, it mitigates the risk of meter shortages, which would exacerbate the already problematic issue of estimated billing.

Second, it provides a more financially sustainable environment for MAPs, which are pivotal players in the electricity supply chain.

Lastly, it accommodates the realities of a volatile foreign exchange market, ensuring that meter pricing reflects true operational costs. 

However, not everyone is on board with NERC’s lofty plans.  

Reacting to the increase in meter prices, Dozie Igweilo, the Founder of QuadLoop, a circular economy startup based in Lagos, told ThePressNG that he holds skepticism regarding the anticipated surge in meter purchases following this price review.

His belief stems from the stark reality that a considerable portion of the populace struggles to afford these meters.  

Thus, many Nigerians are likely to perceive the updated prices as exorbitant, potentially labelling it as an exploitation of their financial constraints. He said: 

Imoh Heavens, an Akwa Ibom resident told ThePressNG that the prevailing hardship in the country is the primary barrier preventing people from making purchases.

He however noted that even if the cost surges to N200,000, individuals will willingly opt for it over enduring exorbitant estimated bills from Port Harcourt Distribution Company (DisCo).  

He said: 

“PH DisCo is often regarded as an unscrupulous entity, causing immense financial strain and even premature deaths due to the stress it inflicts. For instance, in Ibesikpo B, Akwa Ibom State, the highest energy cap for non-metered customers stands at 245.  

Shola Ogunniyi, the Managing Director at Hacom Energy Limited told ThePressNG that since the deregulation of the FX rates, the landing cost of meters and other ancillary fees have surged above the NERC regulated prices.

Consequently, the price increase for single and three-phase meters is inevitable, however, the price increase is further reducing the ability of consumers to purchase meters.  

He said: