The Nigerian Electricity Regulatory Commission, NERC, has imposed a N10.5 billion fine on electricity distribution companies, DisCos, for overbilling customers without meters, totaling N105.05 billion in the first nine months of 2023.
In separate directives issued to the DisCos on Friday, the Commission stated that the utilities had violated a 2020 order regarding the capping of electricity charges for unmetered customers.
An examination of the directives revealed that the Abuja Electricity Distribution Company, AEDC, overcharged its unmetered customers by N17.874 billion, while the Eko Distribution Company, EKEDC, overbilled its customers without meters by N13.137 billion.
Similarly, the Port Harcourt Electricity Distribution Company, PHEDC, overcharged its unmetered customers by N14.187 billion, and Kaduna Electric overcharged its customers by N1.145 billion.
NERC mandated the DisCos to reimburse the affected customers fully and ensure compliance in the future, imposing a 10 percent fine on the utilities to discourage future occurrences.
The Commission clarified that, “In 2020, the Commission issued the Order on Capping of Estimated Bills (Order No: NERC/197/2020) and subsequently issued monthly energy caps, which aimed to align the estimated bills for unmetered customers with the measured consumption of metered customers on the same supply feeder.”
READ ALSO: DisCos Announce Electricity Tariff Hike Effective January 1
“A review of the Electricity Distribution Companies billing of unmetered customers for 2023 has revealed non-compliance with the monthly energy caps issued by the Commission.
“In response to this and in a bid to safeguard unmetered customers from arbitrary billing by DisCos, the Commission, pursuant to Section 34(1)(d) of the Electricity Act 2023 (“EA 2023”), has issued the Order on Non-Compliance with Capping of Estimated Bills (Order No: NERC/2024/004-014) which stipulates the following: “Credit Adjustment to Customers: DisCos are to issue credit adjustments to all overbilled unmetered customers for the period January to September 2023 by the March 2024 billing cycle.
“Public Notice: DisCos have been directed to publish the list of credit adjustment beneficiaries in two national dailies and on their website no later than 31st March 2024.
“Regulatory Sanctions: The Commission shall deduct a sum of N10,505,286,072 from the annual allowed revenues of the eleven (11) DisCos during the next tariff review, to deter future non-compliance with the energy caps approved by the Commission”.
Specifically, for Eko DisCo, the Commission said: “To forestall further non-compliance, a deduction of N1,413,766,176 which is equivalent to 10% of the Naira value of the total over-billing for the period January – September 2023 shall be applied to EKEDC’s annual OpEx over a rolling 12-month period during the next tariff review.
“Notwithstanding the provisions of section (11B)(i), and pursuant to the provision of section 34(2)(f) of the EA 2023, the Commission may deduct a greater percentage of the total over-billing from EKEDC’s admin OPEX where a non-compliance with capping Orders persists”.