The Abuja Electricity Distribution Plc (AEDC) has become the first electricity distribution company to come under the hammer of the Nigerian Electricity Regulatory Commission (NERC) for non-compliance with the directives under the Supplementary Order to the April 2024 Multi-Year Tariff Order 2024 released on Monday.
Under the Order, NERC revised upwards the electricity tariff payable by customers under Band A category of consumers who enjoy a minimum of 20 hours of electricity supply from the various electricity distribution companies (DISCOs).
From a previous rate of between N66 and N68 per kilowatt hour (kWh), the latest Order said this category of consumers would, effective last Wednesday, be expected to pay N225 per kWh.
However, the Order imposed a number of service commitments the various DISCOs would be expected to discharge.
The N200 million enforcement action against AEDC, the Commission said in a statement on Friday in Abuja, was a result of the company’s failure to comply with the prescribed customer band classifications for the tariff billing.
NERC said the decision followed a detailed review and customer feedback, which revealed that AEDC had applied the new tariff to all customer bands, contrary to the Order, which directed that only customers in Band A who are enjoying a minimum of 20 hours of supply daily should be affected.
The Commission said the Order, which was designed to ensure fair billing practices, with tariffs for all other customer Bands, namely B, C, D, and E, allowed to continue to remain frozen.
As the service improves, the DISCOs were mandated to continuously ensure upward migration of customers from the lower service Bands to the elite Band A service level in line with the target on improvement in quality of service delivery.
As part of the service commitment, the DISCOs were directed to publish daily on its website a rolling seven-day average daily hours of supply on each Band A feeder the next day.
Where the DISCo fails to deliver on the committed level of service on a Band A feeder for consecutive two days, the company was directed to publish on its website the next an explanation of the reasons for the failure and update the affected customers on the timeline for restoration of service to the committed service level.
Again, where the DISCo fails to realise the committed service level to a Band A feeder for seven consecutive days, the feeder shall be automatically downgraded to the recorded level of supply in accordance with applicable framework.
Following the announcement of the new tariff, the AEDC was reported to have applied the N225 per kWh rate to all customer bands in its franchise.
NERC said after a detailed review and customer feedback, the AEDC was found culpable of violating the directives under the Order, therefore liable to sanctions by paying a N200 million fine for the offence.
In addition, the Commission said AEDC was mandated to reimburse all customers in Bands B, C, D and E respectively that were billed above the allowed customer categories/tariff bands provided in the Order.
The Commission said the reimbursement should be effected through the provision of the balance of customer tokens that the affected customers would be entitled to receive at the applicable rates.
All token reimbursements, the Commission said, shall be issued by AEDC to the affected customers by latest by April 11, 2024, while evidence of compliance with the directives should be submitted to the Commission by April 12, 2024.
“The action by the Commission underscores its commitment to protecting consumer rights and ensuring equitable practices within Nigeria’s electricity sector,” NERC said in a statement on Friday.
Under the new tariff order, non-MD customers that have been paying N68.20 per kWh since January had a 230 percent increase in rate to N225 kWh; MD1 and MD2 customers that have been paying N81.18 per kWh since January received 177 percent increment in rate, while MD2 Special customers that had been paying N66.95 per kWh in January got a 236 percent increase in rate.
Meanwhile, AEDC on Friday denied any deliberate wrongdoing over the matter, blaming the billing error on a system glitch.
In a notice to its customers in Abuja, AEDC said the affected customers in Band A categories of consumers were mistakenly charged after some of them tried to recharge their meters following the introduction of the new tariff regime on Wednesday.
“This is to inform customers across the AEDC franchise that we are aware of the wrong charges faced by some Band A customers who tried to recharge their meters following the new tariff regime.
“This is due to a system glitch caused by the reclassification of some Band A customers who have now been downgraded to B due to the number of hours of electricity supply enjoyed over the past few weeks.
“These erstwhile Band A customers who vended were charged the new tariff of N225 per kilowatt hour. Our team is working to identify the customers affected, and all excess charges will be refunded,” the AEDC said.
“We apologise for any inconvenience caused to our customers during this change. We remain committed to improving the power supply to all categories of customers, and we crave your understanding and support as we do this,” the company added.
EDITOR’s NOTE: This story was updated to accommodate the reaction by the AEDC over the sanctions.
