Fixed Charges: NERC Bows To Senate Pressure

Sam-Amadi-NERCThe Nigerian Electricity Regulatory Commission (NERC) has bowed to pressure from the Senate by directing Distribution Companies (Discos) to review the issue of fixed charges.
The Senate had weeks ago passed a resolution ordering the commission to abolish fixed charges of electricity and indiscriminate billing of electricity consumers.
The commission in a seven-page response to a query by the Senate, said it had asked the distribution companies to find a way to restructure the fixed charges such that no one would be made to pay for electricity not consumed.
In the response signed by its Chairman/Chief Executive Officer, Sam Amadi, the NERC said even though the fixed charge collected was not illegal, the commission had been able to intervene in the matter.
“In recognition of the negative impact of the fixed charge, the commission has held several public consultations to ascertain a measure that will guarantee financial viability in the industry and not expose consumers to paying for electricity not consumed.
“Based on the intervention of the commission, the distribution companies have agreed to find a way to restructure the fixed charge such that a consumer who does not receive electricity supply does not pay the fixed charge.
“This remodeling of the fixed charge will be part of the ongoing tariff review process being conducted by the distribution companies.
“NERC will continue to ensure that whatever model is presented for its approval is fair and reasonable, and ensures the survival of the new electricity market and improves quality of supply to consumers”, he stated.
On the bulk metering of customers, the commission said it is totally in agreement with the Senate on the need to eliminate the sharp practice.
Mr. Amadi said the commission supports the Senate’s position that electricity consumers be metered individually and urged customers to reject community bulk metering.
“The commission agrees with the Senate’s position on the need to eliminate the practice of bulk billing of residential customers and replace the practice with individual metering and billing.
“It is important to state that the commission had previously abolished bulk billing in its ruling on the VGC Case NO: NERC/H/03/07. The case was brought by a customer against the VGC Estate management and the Eko Electricity Distribution Company in 2008. The commission ruled in favour of the customer.
“The decision of the commission stipulated that every customer is expected to be metered individually irrespective of the status of supply coming into the area and the class of billing should be on R2 or as appropriately determined by Discos”, it said.