₦airaland Forum

nairalanda1:
Ah, so you love this tinubu government, eh?

Jokes aside, when government subsidises power, that means price controls. That means, reduced profits.

So, at the end, estimated billing happens....it;s a symptom of a wider problem, not letting people set prices as they see fit, so that they can pay for improvements, expansion, gas, and so forth. All of that costs money.

Let's even talk about meters. Meters cost money, a good part of them are made in nigeria, and guess what, workers are suffering tinubulation and have to be paid better salaries. Can your disco afford to meter everyone when they are not earning that kind of profit? You see where I am going... ?.

There are many reasons why this government is not serious. Many times they take decisions that would ensure reelection, not growth and development.

Customers pay for the meter, it's not free, so the idea that Discos can't afford it is baseless. The fact that Discos hoard meters is a testament to this. They complain about everything, but dead to their own responsibilities. What exactly are they doing in business if their infrastructures are rotten and they rely on their customers to take responsibility for replacing or buying transformers and electrifying their neighborhoods?

DeOTR:
Customers pay for the meter, it's not free, so the idea that Discos can't afford it is baseless. The fact that Discos hoard meters is a testament to this. They complain about everything, but dead to their own responsibilities. What exactly are they doing in business if their infrastructures are rotten and they rely on their customers to take responsibility for replacing or buying transformers and electrifying their neighborhoods?

Customers pay for the meter, because discos cannot afford to give it to them free.

Also, discos are still not earning the kind of profit that would enable them meet their responsibilites.

That's where the problem is. When you run a business where 80% of your consumers are underpaying you, would you be able to make the business work as it should? Our power sector in a nutshell.

You should stop looking at things from a marxist perspective. This is not oppressor vs oppressed.

SmartPolician:
Discos are hoarding prepaid metres because they use postpaid billings to make up for huge losses they incur through energy losses due obsolete distribution infrastructure and theft from bypassed metres.

The bigger problem with today's Discos is that they are mostly owned by politically exposed people and their goons. That's why they are not serious about taking steps to make that business profitable.

In summary, prepaid metre cannot totally solve the problem. I have proposed that instead of having one disco for a state or region, it should be further unbundled so that every LGA will have a disco. That way, the owners can properly monitor power distribution to ensure that consumers are paying, they can upgrade obsolete distribution lines and that they have enough returns to buy more energy.

first bolded, there's a new type of meter being rolled out for some years now that automatically trips off once you try tampering with it. DISCO's should stop hoarding those meters because it's surely against the law that establishes them and I would as president have forfeited their licences fast.

DISCO's say they are owed 5 trillion naira, let's say they successfully push out 30 million meters with an average family spending 50k on recharge a month, isn't that 1.5 trillion and counting ? If we're honest with our accounting, everything can be cleared within a year or two and I believe president Tinubu has to personally put his feet down on this to save Nigerians

uchennamani:
Lol. You no even understand wetin dey happen. It is not about billing whether it is metered or estimated, it is about the cost of power.

and they make their money from consumers who pay through bills. The koko of everything is bills at the end of the day. I don't want to get into that corruption riddled subsidy regime

KillahPriest:
first bolded, there's a new type of meter being rolled out for some years now that automatically trips off once you try tampering with it. DISCO's should stop hoarding those meters because it's surely against the law that establishes them and I would as president have forfeited their licences fast.

DISCO's say they are owed 5 trillion naira, let's say they successfully push out 30 million meters with an average family spending 50k on recharge a month, isn't that 1.5 trillion and counting ? If we're honest with our accounting, everything can be cleared within a year or two and I believe president Tinubu has to personally put his feet down on this to save Nigerians

I have privileged information that your president owns a disco in Lagos. Dey play! That's one of the reasons I made the comment you quoted. In fact, he has used his influence to get more power for its customers. That's why people living on the island are mostly on Band A, enjoying steady power but paying crazy bills.

nairalanda1:
Estimated billing happens because a large percentage of people don't pay for power.

So discos essentially rip off some consumers who do pay via estimated billing to survive financially

Metering is happening though..my.local disco is rolling out meters well well

nobody will pay for power if they can avoid it without consequences na, that's why I said share these meters. When Fashola was minister, the first two states he rolled out meters in was Lagos and Sokoto. Now, imagine he did same in 34 other states and Abuja at once, what do you think the impact would be ? The issue here is that the local nepa offices are reluctant to distribute these meters and deduct gradual amounts from payments as directed by the FG as against outright payments that they prefer besides, why hurry when they make more slush funds without receipts from estimated billing ?

KillahPriest:
nobody will pay for power if they can avoid it without consequences na, that's why I said share these meters. When Fashola was minister, the first two states he rolled out meters in was Lagos and Sokoto. Now, imagine he did same in 34 other states and Abuja at once, what do you think the impact would be ? The issue here is that the local nepa offices are reluctant to distribute these meters and deduct gradual amounts from payments as directed by the FG as against outright payments that they prefer besides, why hurry when they make more slush funds without receipts from estimated billing ?

The thing is, meters does not stop people from not paying. Meters are bypassed...infact a good proportion of the people who do not pay anything for power have meters. (My former landlord rented flat that had meter to people who not only did not pay, but bypassed the meter. The man had to pay the penalty for non payment when the tenants moved out...lol).

Nigerians think that power should be free of charge. That's because most of us are poor. And poor people don't want to hear long explanation or long term thinking, they want their daily bread now.

seunowa:
This is the reform of the federal government to decentralized electricity supply bearing fruits...kudus to Tinubu foresight

the power sector needs proper deregulation, not decentralization, this merely pushed regulation to the state levels, but it is still regulation. The govt cannot just arbitrarily fixe prices for a product it does not produce, there should be an independent body that carefully considers all parameters and then fix prices.

A peculiar mess....Adelabu you're working !

The elwctricity act is suppose to give states chance at fixing elecyricity iasues locally and not for them to dictate to others.

SmartPolician:
The worst thing that would happen to any country is to have people who have zero knowledge of how to run a successful business heading sensitive agencies that regulate a critical industry.

If the Enugu regulator thinks that the Discos are overbilling the consumers, why not launch your own company and start giving it for free? After all, there was a time in this country when the government had MTel and we knew what later happened to the state-run telco.

What are you saying? Contradicting urself

adenigga:
Source: https://punchng.com/Electricity-Act-fallout-Gencos-Discos-rage-as-states-begin-tariff-cuts

I think it is N60/kw here in Jos.

ernieboy:
the power sector needs proper deregulation, not decentralization, this merely pushed regulation to the state levels, but it is still regulation. The govt cannot just arbitrarily fixe prices for a product it does not produce, there should be an independent body that carefully considers all parameters and then fix prices.

Have you seen the profits that these companies are posting even after heavy thievery by it staff. It should not be so for essential service. The state needs to gag them the more. Complaining without putting the company on sale is mere charade.
They are ripp offs

nairalanda1:
Discos want to be profitable, but government does not let them.

As it stands, only 20% of customers pay for power at market price. The rest pay below market prices or do not pay at all. That does look lovely don't it.?

That impacts profits. Yeah they make one trillion in profit , but it needs to be much more

And also we can't attract serious players ie serious electrical companies because who is going to invest in a sector where the government is setting prices. You won't see return on investment at all. You won't make enough to even pay for improved servieses self.

But not all discos are or were on wed by politicans. Abuja disco was run by KANN which is a Zimbabwe owned company. Not anymore because years of subsidy forced it to hand over to the banks that run it now.

If the fg does what you want , your fellow citizens and opposition politicians will cry that timunubu hates Nigerians and killed Nigerians, do you think fg doesn't know that they should wash their hands off anything power ? But they also know the ripple effect, this is why i think it was a smart move by this fg to quickly decentralise power to the states, let's see how Enugu will keep up the subsidy if it can .

thesolutions:
Have you seen the profits that these companies are posting even after heavy thievery by it staff. It should not be so for essential service. The state needs to gag them the more. Complaining without putting the company on sale is mere charade.
They are ripp offs

can you post a link to the source of your info on their profits, I am yet to come across any.

I totally understand you.

Let's look at it from the paradigm of a simple business transaction.

You are selling a bag of tomatoes at N200. A father says because his son can not afford it, just give him at N100 and he, the father, would pay you the remaining balance at a later date. And you agreed.

After a while, you realized that the father does not have the capacity to pay and you force the son to pay. Unfortunately, the father keeps on with the agreement and keeps owing you.

Now, the son (Enugu Electricity Board), sits with the agreement note and says "If we are to continue with the agreement, I will be paying only N100 going forward or I pay N200 flat with my father not getting involved.

And what do you now say? "Ohhhh. I just realized that my price has actually gone to N300. So I deserve to collect N200 from you and still get N100 from your father later".

This is the issue.

Note:
I am not in any way supporting either side. I am simply clarifying.

nairalanda1:
When the subsides are paid, they don't cover the 10-15 trillion naira yearly that the sector needs to enable them to make improvements

Also, government revenues this year have been very very poor. Oil , which forms 80% of government revenues, has been low in price for most of the year. I doubt there would be cash for subsides.

Subsides also serve to keep the companies from going under...they don't provide enough to keep things running. And again, they do not get paid on time or paid enough. And they are not sufficent to cover expansion and improvement costs.

adenigga:
Source: https://punchng.com/Electricity-Act-fallout-Gencos-Discos-rage-as-states-begin-tariff-cuts

The corruption in the power/energy sector is enough to drown a country.

TheBizGenius:
I totally understand you.

Let's look at it from the paradigm of a simple business transaction.

You are selling a bag of tomatoes at N200. A father says because his son can not afford it, just give him at N100 and he, the father, would pay you the remaining balance at a later date. And you agreed.

After a while, you realized that the father does not have the capacity to pay and you force the son to pay. Unfortunately, the father keeps on with the agreement and keeps owing you.

Now, the son (Enugu Electricity Board), sits with the agreement note and says "If we are to continue with the agreement, I will be paying only N100 going forward or I pay N200 flat with my father not getting involved.

And what do you now say? "Ohhhh. I just realized that my price has actually gone to N300. So I deserve to collect N200 from you and still get N100 from your father later".

This is the issue.

Note:
I am not in any way supporting either side. I am simply clarifying.

Sorry, but your analogy does not make sense.

If tomato.sellers had the majority of their customers behaving like the one in your story they will be out of business in minutes.

The discos are the tomato sellers . Not the son

benardtotti:
If the fg does what you want , your fellow citizens and opposition politicians will cry that timunubu hates Nigerians and killed Nigerians, do you think fg doesn't know that they should wash their hands off anything power ? But they also know the ripple effect, this is why i think it was a smart move by this fg to quickly decentralise power to the states, let's see how Enugu will keep up the subsidy if it can .

Lol, what do you think I arguing for?

Anyway, what the federal and state governments are doing by price setting is why we don't have light.

You don't need to support any politicans to see that. It has been clear to me since 2013.

Tariffs for Bands B, C, D, and E frozen at what ?

Tariffs for Bands B, C, D, and E frozen at what?

Reference:
Just read the entire thing.

First and foremost. With the decentralisation and states/regions having their service independence perhaps EEDC feels its share of the 4 trillion debt, legacy or not is insignificant or perhaps manageable so they are willing to take it on.

But what I also think is that they are looking at the whole industry with a view to creating a healthy balance between supply and demand. For just as it is easy for the vendors to say right pricing or supply collapse, it is also incumbent fir them to realuse that wrong pricing will lead to demand collapse.

Indeed GENCOS and DISCOS are seeing a drop in consumption across board due to the higher tariffs. Nigerians are reacting both legally and illegally, by investing in alternative power, stealing more or just reducing consumption.

So this vicious cycle may prove unsustainable for electricity supply. And the tendency to pursue or close the funding gap may lead to ever higher tariffs and ever lower revenues. The business model has to be re examined, discussed or debated and a decision reached on the structure and quantity of subsidies to be paid because one thing is very clear.

The micro economy (personal, business) just cannot commercially sustain the electricity sector as it is today and the only way out is either a general improvement if the economy to raise incomes or for the power sector to find cheaper ways to generate and distribute electricity.

There are no easy answers. We are not just in between a rock, but a huge mountain and a very hard place, a vast, smouldering desert.

This would eventually happen if the DISCOs aren't checked and put in place..
Their focus is solely on revenue . Very little attention is paid to upgrade and maintenance.
The crazy notion that customers pay for repairs and replacement of equipment can't continue. What would happen is the eventual collapse of the system..
By the time 30-40% are bypassing and stealing power and your infrastructure gets decayed up to a point and you can no longer service your loans or pay salaries..then we'll know.
What EERC did was extremely commendable and I expect other states to emulate such..
This will force the DISCOs to roll out PPM and carry out upgrade on their infrastructure..
This would solve the issue of theft and increase their revenue..
They don't want to work but reap..
That's their MO.

DeOTR:
Discos sole responsibility is to distribute, but they're not doing that at all, leaving the responsibility to the customers or the government and waiting to reap the benefits. When was the last time you see a new transformer or extensions of high tensions wires to a new neighborhood and it's the Disco that's responsible for it?

are we not talking about the same thing.

nairalanda1:
Customers pay for the meter, because discos cannot afford to give it to them free.

Also, discos are still not earning the kind of profit that would enable them meet their responsibilites.

That's where the problem is. When you run a business where 80% of your consumers are underpaying you, would you be able to make the business work as it should? Our power sector in a nutshell.

You should stop looking at things from a marxist perspective. This is not oppressor vs oppressed.

Nobody in the world will pay for services not rendered. Allow these Discos to charge 2k per kilowatt and nothing would still change.
Nobody is forcing them to go into power distro business, if they can't invest in it to bargain better tariff, they should give way to people that have the money to invest.

If the tarriff is too high, people will find ways to steal light without paying a dime.

adenigga:
Source: https://punchng.com/Electricity-Act-fallout-Gencos-Discos-rage-as-states-begin-tariff-cuts

It baffles me that, Delta state can't generate their own power, even as the state with the highest federal allocation in the country.

DeOTR:
Nobody in the world will pay for services not rendered. Allow these Discos to charge 2k per kilowatt and nothing would still change.
Nobody is forcing them to go into power distro business, if they can't invest in it to bargain better tariff, they should give way to people that have the money to invest.

And that's what I am telling you...discos cannot render services because....80% of consumers are underpaying them thanks to government rules and regulations.

Oga, don't argue. You cannot run a business on that kind of consumer base. You will be run out of business. That they even are stilla round has a lot to do with subsides, and loans. And three of the discos have been taken over by the creditor banks because they can't raise enough cash to pay for service.

Oga, be honest with me . You want free electricity. That's what this is all about.

Good morning. Aint no use arguning with someone who is going round in circles.

nairalanda1:
That's how we make the chance of getting 24 hour electricity even more remote.

The states are just copying tinubu subsidy plan for most Nigerians. At the end of the day, it's going to be reduced profits and reduced investment in generation and transmission

And we will all be the worse for it.

A business runs well when government does not set it's prices. Tinubu and the governor's seem not to get it

Make we enjoy our no light. We voted for it

These ones are reaping Nigerians off when government didn't intervene. Over N250 per unit. What has improved since they began this kind of tariff? No power supply in my area since yesterday, almost 24 hours straight

maasoap:
These ones are reaping Nigerians off when government didn't intervene. Over N250 per unit. What has improved since they began this kind of tariff? No power supply in my area since yesterday, almost 24 hours straight

Okay, set up your own disco and charge N50 per kwh. Help poor nigerians

Good morning, and god bless

nairalanda1:
Yeah..mtel was forced to charge cheap tarrifs and was beaten to the ground by mtn, glo and now Airtel

Businesses do well when government does not set their prices in the name of regulation

Mtel was beaten into the ground not because of cheap tariff but because it was treated like government owned business where everyone would be busy stealing right and left until nothing is left

maasoap:
Mtel was beaten into the ground not because of cheap tariff but because it was treated like government owned business where everyone would be busy stealing right and left until nothing is left

No, it was charging N20 per minute, when MTN , GLO AND AIRTEL were charging N30-50.

Guess what? MTN and company had the money to expand businesses, and run customer incentives...eg them competitions. Mtel had nothing of the sort. (I was an Mtel customer from 2004-7)

And yes, that is part of running it as a government company. Cheap prices for the masses so that they can get elected again...lol.

It exists as an internet service provider now...

nairalanda1:
Estimated billing happens because a large percentage of people don't pay for power.

So discos essentially rip off some consumers who do pay via estimated billing to survive financially

Metering is happening though..my.local disco is rolling out meters well well

To survive on the back of struggling Nigerians, right?
State governments have stake in power sector, if they make profits, they are all going to share it. Because of this reason, state governments can't do something that will affect their own IGR. In this case, if state governments declared that current band A tariff is a reap off as we all knew already, then it is now confirmed to be a rip off

maasoap:
To survive on the back of struggling Nigerians, right?
State governments have stake in power sector, if they make profits, they are all going to share it. Because of this reason, state governments can't do something that will affect their own IGR. In this case, if state governments declared that current band A tariff is a reap off as we all knew already, then it is now confirmed to be a rip off

LIke I said, start your own disco and sell power at N50 per kwh to nigerians. Dem go hail you, and you will make decent profit...