Peter Obi to remove non-performing investors of DisCos if elected
Labour Party presidential candidate, Peter Obi plans to remove non-performing investors of distribution companies (DisCos) if elected as president in 2023.
This is according to his campaign manifesto which was officially released on Sunday, December 4. In the manifesto, it was stated that if elected, the Obi administration will enforce the removal of investors who are not performing to the accepted standard.
Nairametrics had earlier reported that Peter Obi plans to reform the entire power sector value chain – generation, transmission, and distribution in order to maximize performance for the benefit of Nigerians.
Needed criteria for DisCo investors: According to the manifesto, DisCo investors will need to demonstrate the adequate capacity to improve their network, improve quality of service and customer satisfaction as well as demonstrate the adequate capacity to continue to operate their franchises satisfactorily, including investments in technology, human capacity, and customer offerings.
- However, Peter Obi plans to offer support in the following power distribution areas.
- Ending estimated billing: Peter Obi plans to put an end to estimated billing which is an untenable and opaque way to measure and sell energy to consumers.
- The manifesto states that Obi will provide support to DisCos who give optimal performance, as well as ensure that the Nigerian Electricity Regulatory Commission (NERC) continues to ensure cost-reflective energy tariffs.
Metering: The Peter Obi manifesto promises to ensure the completion of the National Mass Metering Program (NMMP) and will require DisCos to replace all damaged and obsolete meters under the NMMP, in strict compliance with the Metering Code and other extant regulations by the end of 2023.
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Tackling losses: Peter Obi will support DisCos with distribution and transmission bottlenecks by the end of 2023. This will help to cut technical and commercial losses to single digits across the Nigerian Electricity Supply Industry (NESI).
- To understand why tackling commercial losses in the power distribution sub-sector, it is instructive to know that data from NERC says that the total energy received by all distribution companies (DisCos) in Q4/2021 was 7,912.05 gigawatts per hour (GW/h), while the total energy billed was 6,057.78GWh and billing efficiency was 76.56%.
What this means: A 70% billing efficiency means that for every N10.00 worth of electricity delivered to consumers by a DisCo over a given period, the DisCo is only able to issue bills to cover N7.00 worth of energy, with N3.00 worth of energy remaining unbilled, due to reasons ranging from energy theft, poor distribution infrastructure, and inadequate customer enumeration.
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For the record: The NERC data stated further that DisCos are unable to identify who consumes all their energy due to poor customer enumeration and low metering.
- The report stated that billing efficiency combines technical and commercial efficiencies.
- Data from the National Bureau of Statistics (NBS) says that metered Nigerians as of Q2/2022 were 4,958,795.