Nigeria’s electricity distribution companies (DisCos) recorded a significant increase in billing efficiency during the first three months in 2019 but continues to remit poorly says the Nigerian Electricity Regulatory Commission (NERC) in its latest sector report.
“Out of the 7,193GWH total energy received by all Discos in the first quarter, 5,762GWH (80 percent) was billed to the end-users, implying technical and commercial losses of 20 percent and 4 percentage points increase in billing efficiency,” said the NERC, in its first quarterly report for 2019.
The regulator said the level of Discos’ billing efficiency shows that, for every 10kwh of energy received by Discos from the Transmission System Provider (TSP), approximately 2kwh is lost due to technical constraint and energy theft.
“In other words, for every N10 worth of electricity received by Discos during the first quarter of 2019, N2.00 is lost due to energy theft and poor distribution infrastructure.
However, the regulator also said that during the quarter under review, Discos were issued a total invoice of N190.1billion for energy received from NBET and for the administrative services by MO, but only a total of N52.8billion or around 28 percent of the invoice was settled, creating a total deficit of N137.3billion.
“A comparative analysis of market invoice performance by Discos in the first quarter represented indicates an average settlement rate per Disco of only 28 percent of the market invoice,” the regulator said.
None of the Discos exceeded a settlement of 50 percent of its market invoices during the first quarter of 2019. Jos Disco recorded the worst remittance performance of 10 percent followed by Kaduna Discos at 13 percent.
The total revenue collected by eleven (11) Discos from customers in the first quarter of 2019 stood at N116.9billion out of the total billing of N182.8billion
Ikeja Disco had the highest billing efficiency of 96 percent in the first quarter while Yola Disco recorded the lowest efficiency of 61 percent
NERC expressed concerned about the high technical losses at the distribution network, as 20 percent technical and commercial losses are much above the global standard.
The regulator also reported a decline in the stability of the grid network, which has seen recorded a five incidences of a total grid collapse, resulting in total blackout nationwide.
“To improve the grid stability and prevent a total collapse in subsequent quarters and beyond, the commission, in collaboration with Transmission Company of Nigeria shall continue to intensify its monitoring and supervision efforts to ensure strict compliance with the system operators’ directives to generators on free governor and frequency control mode in line with the provisions of the extant operating codes in the industry.”
NERC stated further in the publication that it had approved the request by the TCN to competitively procure spinning reserves for the industry.
“This is to guarantee adequate spinning reserves for proper management of the grid by the system operator.”
The report notes further that the total electric energy generated was 8,951,869mwh -0.8 percent more than the level of the generation during the fourth quarter of 2018. During the quarter, the industry recorded the peak generation of 5,375mw.
The report notes further that, “Despite the decline in the available generation units in the first quarter, the total energy generation rose by 08 percent with 8.9 percentage points increase in generation capacity utilisation arising from the reduction in the constraints of insufficient gas supply, transmission and distribution networks, and water management at the hydropower stations.”
