The inability of the 11 Distribution Companies (DisCo) to collect money for services rendered to consumers in their network areas led to…
The inability of the 11 Distribution Companies (DisCo) to collect money for services rendered to consumers in their network areas led to the reduction of revenue collected by the companies in the first quarter of 2023.
In a report published by the Nigerian Electricity Regulatory Commission (NERC), it stated that the total revenue collected by all DisCos during the period was N247bn from the N359.3bn billed to customers.
The report noted that the figure was 68.75 percent of revenue collection, which represented a decline of 4.58 percent when compared to Q4 2022 (73.33%).
NERC said the development marked the first time in five quarters (one year) the DisCos cumulatively recorded a reduction in their quarter-on-quarter collection efficiency.
“Relative to 2022/Q4, the improvement recorded in the total billing N27.1bn (8.15%) does not correspond to the improvement recorded in total collections N3.4bn (1.41 percent). This resulted in the decline in collection efficiency recorded in the quarter.
“With increased collections representing 17.30 percent of increased billing, collection efficiency is bound to reduce. This puts an impetus on the DisCos to employ technologies and operational procedures that will increase both billing and collection performances to forestall long-term financial challenges.”
Similarly, it said the DisCos would pay N252.9bn to the electricity market, consisting of N209.2bn for generation costs from NBET and N43.6bn for transmission and administrative services by the Market Operator (MO).
Foreign companies fail to pay $16.1m
The report revealed that special and cross-border customers failed to make payment for the cumulative $16.11m invoice issued to them during the quarter.
It added that out of the N842.3m invoice issued by Market Operators (MO) to all the eight bilateral customers in the Nigerian Electricity Supply Industry, only North-South/Star Pipe made a remittance of N15.3m against its invoice of N24.6m.
“The non-remittance by bilateral consumers continues a trend that was highlighted in the past quarterly reports. The MO must invoke the provision of the market rules to curtail the payment indiscipline being exhibited by the various market participants,” it said.
It said the Aggregate Technical, Commercial & Collection Loss (ATC&C) during the period was 46.39 percent comprising – technical and commercial loss (22.03 percent) and collection loss (31.25 percent).