Electricity distribution companies (DisCos) have reacted to a directive by the federal government that prepaid meters must be distributed to Nigerians at no cost.
The DisCos, as reported by PUNCH, argued that all Nigerian households cannot get free prepaid meters as the government, which made the promise, is not willing to bear the full costs involved, including installation costs.
Legit.ng reported that the Minister of Power, Adebayo Adelabu, directed the DisCos to distribute prepaid meters to Nigerians free of any charges. The minister issued the directive on Thursday while inspecting newly imported meters at the APM terminal in Apapa, Lagos.
According to Adelabu, the meters were procured under the World Bank–funded Distribution Sector Recovery Programme and are meant to be installed for consumers free of charge, regardless of customer category or electricity band.
The minister said it is illegal for any DisCo or installer to charge customers for meter installation.
Meanwhile, DisCo operators, who spoke anonymously to PUNCH, described the announcement by the Minister of Power as a “populist statement” that did not reflect sufficient consultation with key stakeholders, including meter installers and providers.
The operators said the meters labelled as “free” would still be paid for by distribution companies over an extended period, reportedly up to 10 years. They questioned why DisCos should bear the cost of installation when meter installers are not their direct employees.
The operators described the minister’s statement as politically driven, arguing that it failed to address cost recovery, which they said is critical to sustaining investments in the sector. “The statement was just a populist statement from a politician. We are not sure if the President sent him that message.
He said everything should be free; where is the position of cost recovery? Anything you do in the power sector, you have to first consider who bears the cost. Somebody has to bear the cost to avoid debt piling up,” a management staff of one of the operators said. One operator explained that any capital expenditure imposed on DisCos must be recognised in tariff calculations to avoid financial strain, warning that failure to do so could weaken their balance sheets.
Another official said the government appeared not to have addressed how installers would be paid if customers are barred from making payments, noting that metering responsibilities were removed from DisCos years ago under previous power sector reforms.
Free meter directive already affecting MAP scheme
The operators also warned that the directive by the minister was already undermining the Meter Asset Providers (MAP) scheme, which allows customers to purchase meters directly and receive refunds over time through energy credits.
According to them, many customers are now rejecting the MAP option after hearing that meters are supposedly free for everyone, even though the government-supplied meters may not be sufficient to close the country’s metering gap.
The DisCos urged the government and electricity regulator to clarify the free meter directive by stating who will fund meter installation, and clearly communicate which category of customers are eligible for the free meters to avoid confusion and rising tensions between consumers and service providers.
They asked the government to be truthful in the clarification it offers, as customers are already getting agitated over the minister’s comment that charging for meters is illegal. They expressed disappointment that the government failed to consult all relevant stakeholders before making such a declaration to the public.