The Federal Government has planned to release N20 billion to electricity distribution companies for the procurement of meters for unmetered Band A customers by the end of September.
This was announced by Minister of Power, Adebayo Adelabu, in Lagos on Friday.
Adelabu also stated that five power plants under the National Integrated Power Projects are set to be sold for approximately $1.15 billion, with the bidding process finalized and a report submitted to the National Council of Privatisation chaired by Vice President Kashim Shettima.
Speaking at the BusinessDay conference titled ‘Powering Nigeria’s Energy Future: Addressing Infrastructural Challenges for Sustainable Energy Development’, Adelabu highlighted the ongoing full-scale metering initiative aimed at all unmetered Band A electricity customers before the end of September.
It has been reported that the Omotosho plant, which houses four power-generating turbines, is slated for sale at around $85 million, while the Olorunsogo NIPP, also with four turbines, is valued at $170 million.
Back in December 2022, report revealed that a consensus between the federal government and the 36 state governors to sell five NIPP plants and allocate the proceeds to fund the 2023 budget, following over two years of disputes and legal battles surrounding the sales, managed by the Niger Delta Power Holding Company.
Former Director General of the Bureau of Public Enterprises, Alex Okoh, had revealed this agreement between the federal and state governments during an interview in Abuja.
This decision faced opposition from various groups. Over the years, the Bureau of Public Enterprises has been involved in discussions and plans regarding the sale of NIPPs, with evolving details and target sale amounts.
In April 2021, the National Council on Privatisation approved the fast-track sale of five NIPPs, though the estimated value was not disclosed.
By March 2022, the Nigerian National Petroleum Corporation had shown interest in acquiring some NIPPs, indicating ongoing progress in the sale.
In December 2022, Okoh confirmed that an agreement had been reached for the sale of the five NIPPs.
On the topic of metering, Adelabu mentioned the N20 billion allocated for this purpose, with plans in place to procure meters for the unmetered Band A customers.
“We are releasing N20 billion for the electricity distribution companies to procure meters for the unmetered Band A customers before the end of September,” said Adelabu.
Band A customers are those receiving 20-24 hours of electricity supply daily.
The Nigerian Electricity Regulatory Commission announced new rates, increasing from N66/N77 per kilowatt-hour to N225 per kilowatt-hour in April.
The Commission noted that the new tariffs would reduce subsidies by approximately N1.14 trillion in 2024.
In January 2024, NERC estimated that the federal government would spend N1.6 trillion on electricity subsidies for the fiscal year.
According to data from NERC and the National Bureau of Statistics, over seven million electricity customers in Nigeria remain unmetered.
Adelabu further stated, “The government has put in place the required framework to enable an injection of 1.5 million meters into the power sector through the World Bank Distribution Support Recovery Program.
“The Presidential Metering Initiative will ensure an additional 2 million meters will be procured annually for 5 years. This will ensure accurate billing, reducing revenue loss and improving cash flow for a more liquid power sector.”
