The Nigerian Electricity Regulatory Commission (NERC) said it has commenced discussions with the Central Bank of Nigeria (CBN) on the provision of a N200 billion loan facility to support the steady operation of its new regulation designed to ensure that electricity consumers in the country have access to meters within the next three years. The proposal now awaiting approval of the CBN will enable operators of the Meter Asset Provider (MAP) Regulation have access to a single digit interest loan that will enable them provide meters and recoup their fund within 10 years. NERC Commissioner of Finance & Management Services, Mr. Nathan Shitti disclosed this to Eyes Of Lagos exclusively. According to the Commissioner, NERC decided to approach the CBN to provide a backup so as to guarantee the investors access to loan interest funds that sustain the programme. Speaking on how they sold the idea to CBN he said, “What we told CBN was that we need their support for the MAP operators in terms of provision of a loan facility of about N200 billion. The facility is expected to be given at a single digit interest rate. “We asked for that amount because our analysis shows that there is a gap of over 4 million meters in the market, and at an average of N50,000 per meter that will amount to N200billion required. “However, we have not heard from CBN but we are optimistic that they will make the facility available,” he said. Eyes Of Lagos recalls that the CBN had in 2015 under the NESI Stabilization Strategy Scheme provider a similar window to the Distribution Companies (DisCos) to access a N213 billion facility to enhance their operations, recent report shows that only N158.7 billion has so far been accessed by the operators. The NERC had approved a regulation that provides for the supply, installation and maintenance of end-user meters by other parties in late last month as part of efforts to ensure that electricity customers in Nigeria have access to meters. The regulation which took effect from April 3, 2018, according to the Commission expected to fast track a closure of the metering gap and encourages the development of independent and competitive meter services in the electricity industry. Earlier while speaking as a panelist at the meeting, with the theme, “Can Meters Save NESI?,” Mr. Shitti said the MAP scheme was introduced to address the issue of lack of liquidity which had hindered the Distribution Companies (DisCos) effectively providing meters to consumers. While stressing that meters alone cannot save the NESI as the industry is plagued with numerous challenges, Shitti stated that the Commission introduced the MAP after due consultations with stakeholders. “We do not want to over emphasise the issue of metering as we know that even when you meter every customer there would be situations were by there are leakages in the system. “We also believe that this will create opportunity for new investors who will come in with fresh funds into the industry to help solve the challenge of liquidity, what we are trying to do with this scheme is to ensure that the industry is able to access cheap funds that can help it grow and as well providing qualitative products. “We believe that this scheme is going to resolve the issues so we went and did serious consultations with various the stakeholders and consumers, as well as meter manufacturers in Nigeria as well as financiers (including Banks). “As a matter of fact greater part of our consultation was with the financiers because we realized that a proper structuring of the regulation to make room for funding is paramount. So we asked the banks to give us the framework that can make the structure work, because whether you like it or not Nigerians do not trust the DisCos there are evidences of this, so no investor will be willing to put in their funds without a proper structure of recovery. We therefore did not want to tie the scheme to the DisCos so we have to come out with something that can guarantee that the investors can recoup their investment,” he stated.
