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GOVERNMENT BENEFITS FROM THE DISCOS EXPLOITATION OF NIGERIANS| November 2015

 
Barr. Gloria Nweze


Gloria Nweze, chairperson of the Ikeja Nigerian Bar Association, NBA Human Rights Committee and the 1st Vice Chairman of the NBA, Ikeja branch says the discriminatory bills are the result of government and the people’s inabilities to ensure a competitive environment. Interview by Blessing Oigiangbe.

The co-existence of the analog and the digital metering systems is a complete aberration of what to expect in an ideal society. It is a devilish way of segmenting society into two power access classes where the communities of the rich, feared and influential people are issued pre-paid meters while majority with no obvious capacity to compel the DISCOs to issue them pre-paid meters are retained on post-paid meters, laden with streak of manipulations for pecuniary advantages in favour of the operators. It is a clear case of discrimination and fraud against Nigerians with respect to the estimated crazy bills.

Government’s role
The government has been lackadaisical in resolving the problem for obvious reasons. First, PHCN, and now DISCOs cannot be separated from the government clinically because they both enjoy joint ownership of assets and revenue sharing. The revenue targets set by the owners are largely responsible for the injustices against the hapless electricity consumers. It is expedient to share the blame between the major stakeholders, the government for ignoring the constitutional rights of people to equal treatment, fairness and justice in the sharing and utilisation of the resources of the  state; the operators for frustrating every genuine effort of consumers to right the wrongs in electricity services and the consumers for resorting to bribe for favour from DISCOs personnel, engaging in illegal connection and being complacent in fighting for better electricity service rights.

Antitrust laws
The laws are there but the implementation is the major problem. Government does not have enough capacity to operationalize the laws and the people are not sufficiently pushing for answers to questions in this regard. The only semblance of competition in the present power distribution structure in Nigeria is that different DISCOs now take full charge of distribution operations in different parts of towns and cities. It is likely that performance of these DISCOs at various parts of a city could potentially affect people’s residential and business accommodation choices, and by implication, the revenue generation ability of operators in the long run.

Future expectations
In the future, we expect that each DISCO should be further re-sized to operate within one local government in the long run and in a state in the medium term, such that people can at least choose a local government within a state where power service is relatively better. Also, the DISCOs that have mastered the game overtime could be considered as favorites to acquire the poor service providing DISCOs. After all, the government owns the electricity transmission company 100%. The government should issue licenses to many willing credible investors in alternative sources of power, such as solar and wind energy, to operate at local government and community levels.

The DISCOs have electricity distribution monopolies
Abdul – Ganeey Imran, member of human right committee of Nigerian Bar Association, NBA, Ikeja Branch, and the Executive Secretary of the Centre for Law and Civil Culture says the disparity between the pre-paid and post-paid metering of electricity in vogue is unimaginable and alarming. He spoke with Blessing Oigiangbe.

There is a considerable improvement on electricity supply in recent time, however, the relative improvement is not by magical infrastructural improvement on the existing facilities, but by a presidency directive enabling the power companies have access to gas to power their facilities.   

Different metering regimes
The disparity in the charges between the post – paid and pre- paid metering is unimaginable and alarming. A commercial three bedroom apartment I manage in Ikeja on the pre-paid meter is yet to burn out a N20,000 recharge made six months ago while tenants at another property, two bedroom apartments, I manage in Yaba get as high as between N17,000 to N18,000 bill per month on the post-paid meters.

Equity in two metering systems
PHCN at privatization has 11 distribution companies, Abuja Electricity Distribution Plc, Benin Electricity Distribution Plc, Eko Electricity Distribution Plc, Enugu Electricity Distribution Plc, Ibadan Electricity Distribution Plc, Ikeja Electricity Distribution Plc, Jos Electricity Distribution Plc, Kaduna Electricity Distribution Plc, Kano Electricity Distribution Plc, Port Harcourt Electricity Distribution Plc and Yola Electricity Distribution Plc. These companies are under different boards and managements. So, it will not be fair to put all of them under one category as regards the treatment they melt out on their customers.

Still, the disparity in billing process does not reflect fairness, equity and justice, leading to daily complaints from electricity consumers. The Nigeria Electricity Regulatory Commission, NERC, needs better measures to address the situation. A few bad electricity consumers also tamper with their metres, some tap current directly from the pole while others connect their heavy electronic gadgets like air conditioners and electric stoves directly to the poles, thereby short change the electricity distribution company. I think we should look at the issues holistically.

 

 

 

 

 

 

 

 

 

The issues
The electricity supply companies as presently constituted, seem to be operating as monopoly institutions, unlike telecommunications where the consumers have right to switch over from one service to another when not satisfied with the rates or services. We have seen several customers switching or porting from MTN to Glo and vice versa.

The NERC, which is a regulatory agency statutorily saddled with the responsibility to regulate the electric power industry in Nigeria is conceptualized to tackle issues such as when customers refuse to pay exorbitant electricity bills or when the supply is cut off or services disrupted for no just cause. One main duty of NERC is to see that the interests of electricity consumers are properly protected. The NERC in attempt to checkmate excesses of the distribution company as to address genuine complaints from customers set up a consumer forum in about eight different locations across the country. We also have the consumer protection council and the public complaints commission. When these bodies cannot adequately assuage the feeling of the customer, such a customer has the right to institute an action in a court of law.

Relationship between electricity consumers and the DISCOs is contractual in nature, that is, it is a buyer and seller relationship. DISCOs do not require a court order before it can disconnect a defaulting customer and DISCOs and customers have the rights to seek redress in a court of law under commercial law.  For example, if an ice cream producer suffers damage to his stock in refrigerators due to illegal or wrongful disconnection by DISCO, he or she can sue the DISCO concerned and obtain remedy. A customer can also go to court for an injunction to restrain a DISCO from disconnecting electricity supply to his/her property, but such can only be done on good grounds. However, joint efforts from both the members of the public and the government will better address these issues.

For instance, the NERC in September 2015 slammed Ikeja Distribution Company, IKDC, with a fine of N131.4m for flagrant breaches of Credit Advance Payment on Metering Initiative, CAPMI, order of the commission for not metering about 50% of the electricity consumers and placing them on estimated billings. Now, the IKDC has announced plan to distribute 10,000 electricity meters every month to its subscribers. If the tempo is sustained, I believe that in the next few months, complaint from customers should be drastically reduced.

Redress on discriminatory billing
Yes, once there is a wrong or injury, victims can seek legal redress. Administratively, the victim can equally lodge a complaint      with the Consumer Protection Council, CPC. Already, there are many complaints against the electricity distribution companies at the CPC.

Can the DISCOs be sued for discriminatory and crazy billings?
The doors of our courtrooms are open to any citizen who feels aggrieved on issues of overbilling, failure to install electricity metres, high tension cable hazards et cetera to exercise their constitutionaly endowed right to seek redress.

Protection of DISCOs on electricity tariffs pricing and metering
Sam Amadi, chairman of NERC at the NBA conference in Abuja said, “In the Nigerian electricity market, the National Assembly established the NERC to regulate the entire electricity sector. Section 70 of the Electric Power Sector Reform Act 2005 mandates NERC to develop, together with licensees, customer service standards and information to be provided for consumers and the manner of its dissemination.”

Section 32 also mandates NERC to ensure that “adequate supply of electricity is available to consumers, to ensure that the prices charged by licensees are fair to consumers and are sufficient to allow the licensees to finance their activities and to allow for reasonable earning for efficient operations, to ensure safety, security, reliability and quality of service in the production and delivery of electricity to consumers, to ensure that regulation is fair and balanced for licensees, consumers and other stakeholders…” We have mandated that any month they fail to meter consumers who have paid, they will have to refund the sum of N5000 to consumers, he said.

The mandate of the council covers both goods and services and sanctions include providing speedy redress to consumer complaints through negotiations, mediation and conciliation; eliminating hazardous products from the market and causing offenders to replace defective products with safer and more appropriate alternatives.

At divestment, government’s stake in GENCOs is 20% and 40% in DISCOs. Do citizens not have a legal right to demand full accountability on how the companies are run?
The privatisation of these companies substantially put the ownerships in the hands of the individuals who had invested huge amounts to acquire their interests. This has put reasonable limits on the extents to which the public could intervene in the activities of the companies, except the person is a shareholder. It might be impossible to demand full accountability into the account or affairs of the companies, unless a citizen suspects a foul play, particularly as it relates to the profits accruable to the government. The Freedom of Information Bill empowers request for answers to such questions and petitions could be sent to appropriate security agencies.

Best option to address disputes
I will always consider amicable resolutions of issues between the parties. Its faster, safer and less expensive and the outcomes are always win–win.

Possibility of class actions
Recently residents of some parts of Itire – ikate, Surulere in Lagos State dragged the Eko DISCO and NERC to the Federal High Court, Lagos over what the community described as excessive and multiple charges by the Eko DISCO, they also demanded pre–paid meters. That case is still ongoing in court.

Legal action against the government for negligence and waste of tax-payers’ money on power generation
Any citizen of Nigeria can institute a court action against EFCC, ICPC, the Nigeria Police Force and other related agencies/institutions of government requesting the court to compel those organs of government to conduct an in-depth investigation into circumstances that led to colossal waste of the nation’s hard earned tax payer’s money and resources. For instance, until 1985, Ghanaians could not go to court on issue of locus standi, whether or not someone has the right to be heard in court. In Nigeria, locus standi is still a big issue, albeit Ghana has moved beyond such issues. Waste of public funds is really a painful thing. Take for instance, a situation where South Korea spent $12 billion, N2.36trillion to provide 45,000 megawatts of electricity, while in Nigeria $16 billion, N3.14trillion was spent on improving about 4,000 megawatts capacity. Nigerians need to think out of the box and seek ways to make government office holders accountable in a legitimate and speedy manner.

 

 

 

 


 

 

       
       
       
 

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