Power distribution companies have expressed doubt over the directive by the Minister of Power, Adebayo Adelabu, that prepaid meters must be free for all categories of customers.
Operators, who spoke with our correspondent anonymously due to the sensitivity of the matter, said the minister made only a political statement without considering the input of other stakeholders, especially the installers and meter providers.
On Thursday, the Federal Government banned electricity distribution companies and installers from collecting any form of payment for meters, warning that DisCo officials and installers found extorting customers would be prosecuted. Adelabu issued the warning during an on-site inspection of newly imported smart meters at APM Terminals, Apapa, Lagos.
Adelabu said the meters were procured under the World Bank–funded Distribution Sector Recovery Programme and must be installed for consumers free of charge, stressing that any demand for money would be treated as an offence.
According to them, meter installers are not DisCo workers, and someone has to bear the cost of installation. “Those meters you see, someone has to pay for them, and the government expects the DisCos to bear the cost of the so-called free meters. They said the DisCos can pay it over 10 years.
When you ask the DisCos to pay for any capital expenditure, we call it allowable capex. You have to allow it when computing their tariffs; otherwise, it makes their balance sheets toxic,” an official with a distribution company stated.
“He has to tell us who’s going to pay. We agree, people should not pay, no problem, but who will pay? Is it going to be subsidised again? Is the government going to pay for it? If the government says the operators should pay, where will they recover the money from? Every penny has to be accounted for and recovered. The purpose of doing business is cost recovery; if you cannot recover your cost, you will be cutting corners,” another operator stressed.
The DisCos asked the government to always tell the masses the truth, worrying that the customers are already getting agitated over the minister’s comment that meters must be free.
“We must always tell the people the truth. I don’t know how the minister intends to do it, but his comments are not helping matters; he’s not even protecting the MAP scheme. He is putting the MAP scheme in jeopardy. Already, customers are fighting their DisCos because the minister made a statement that meters are free for all. How’s that possible? It is a challenge, but we see how it goes,” an official with one of the DisCos said.
