The Nigerian Electricity Regulatory Commission (NERC) in
line with a resolution passed by the Senate ordering it to
look into complaints by consumer of electricity over
indiscriminate billing has directed electricity Distribution
Companies (Discos) to urgently restructure their fixed
charges in order to ensure no Nigerian is made to pay for
electricity not consumed.

The Discos have also been directed to discontinue the
practice of bulk metering.

The Senate had in its resolution following a motion by
Senators Sam Egwu (Ebonyi North) and David Umaru (Niger
East) entitled: “Unfair trade practices of Electricity
Distribution Companies in Nigeria,” decried the fleecing of
Nigerians by Discos through fixed charges and bulk metering
among others.

The upper chamber had directed NERC to immediately
abolish fixed charges on electricity consumption, bulk
metering of villages and communities. The lawmakers
specifically ordered the NERC to immediately stop the
collection of fixed charges as well as ensure that the people
are not made to pay for energy not consumed.

The Commission in a seven-page response to the Senate's
query last week said it had asked the distribution companies
to find a way to restructure the fixed charge such that no
one would be made to pay for electricity not consumed.
Chairman/Chief Executive Officer, NERC, Sam Amadi, who
signed the letter to the Senate, copy of which is available on
the commission's website regarding the fixed charges by
Discos, said even though the fixed charge collected was not
illegal; the commission had been able to intervene in the
matter.
Amadi said “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 vexed issue of bulk metering of customers, the
Commission said it is totally in agreement with the Senate
on the need to eliminate the sharp practice.
It said it supports the Senate's position that electricity
consumers be metered individually, even as it urged
customers to reject community bulk metering.
Amadi said: "The Commission agrees with the Senate's
position on the need to eliminate the practice of bulk billing
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
Disco.

He added that the Commission has however provided a
leeway for estimation in situations where residential meters
are not provided to customers.

"This is provided in the Estimated Billing Methodology
Regulation of the Commission," he said:
He added: "Communities who are placed on bulk billing
should reject it and insist on individual metering. The
Commission is in the process of completing public
consultation on a proposal to cap the amount an unmetered
customer can pay until he or she is metered.

"The proposal will also commit distribution companies to
strict deadline for metering of all its customers. In the
interim, the Commission has abolished connection of new
customers without meters."

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Senate asked for abolishment of fixed charge while NERC directed the discos to restructure. What does restructure mean?

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