11 Discos record N77.39bn revenue shortfall in Q2 2022




The 11 Electricity Distribution Companies (DisCos) operating in Nigeria recorded a revenue shortfall of N77.39bn out of ₦265.68 billion billed to customers in the second quarter of 2022.

The Second Quarterly 2022 Report released by the Nigerian Electricity Regulatory Commission (NERC), shows that the total revenue collected by all DisCos in 2022/Q2 was ₦188.29 billion.

A breakdown of the report shows a revenue shortfall of N77.39bn recorded by the Discos in the period under review, which NERC described as a collection efficiency of 70.87 percent.

It noted that Benin, Jos, and Enugu DisCos recorded significant increase in collection efficiency by 7.76, 6.90 and 4.80 pp respectively.

 “The total revenue collected by all DisCos in 2022/Q2 was ₦188.29 billion out of ₦265.68 billion billed to customers —this translates to a collection efficiency of 70.87%. Although the total energy bill was reduced by 10.15% (₦295.7 billion in 2021/Q1 vs. ₦265.68 billion in 2022/Q2), the total collections reduced by just 5.47% (₦199.19 billion in 2022/Q1 vs. ₦188.29 billion in 2022/Q2).

“This indicates that at a per kWh level, the collection performance in 2022/Q2 was better than 2022/Q1; this may be on account of DisCos prioritising supply to their most commercially viable customers when there is a drop in available energy.

“The DisCos cumulative collection efficiency increased by 1.53 pp from 69.34% in 2022/Q1 to 70.87% in 2022/Q2. The general increase in collection efficiency in 2022/Q2 could be attributed to the increased metering and a decline in the total billings by 10.15% occasioned by the decreased energy delivered to DisCos (- 13.10%) in 2022/Q2.

“Given that two-thirds of energy delivered to Discos in 2022/Q2 went to residential customers most of whom are not metered and whose monthly energy budget is fixed, delivery of more energy does not always translate to collecting more from them. The increase was largely driven by Benin, Jos, and Enugu DisCos who recorded significant increases in collection efficiency by 7.76, 6.90 and 4.80 pp respectively.

 “Abuja, Eko, Ibadan, Ikeja, Kaduna, Kano and Port Harcourt DisCos also recorded an increase in collection efficiency by 2.36, 1.60, 3.58, 2.04, 2.73, 2.56 and 1.71 pp respectively. Only Yola DisCo recorded a decline in collection efficiency (-8.43 pp) between 2022/Q1 and 2022/Q2’’, the report said.

Performance

On the operational performance, the report noted that the average available generation capacity during the period stood at 4,508.38MW, while the average hourly generation was 3,556.16MWh/h.

It added that the total quarterly generation was 8,848.04GWh from 26 grid-connected generating plants across the country.

“In 2022/Q2, the average available generation capacity was 4,508.38MW, the average hourly generation stood at 3,556.16MWh/h while the total quarterly generation was 8,848.04GWh from 26 grid-connected generating plants across the country. The average available generation capacity was 4,508.38MW – a decline of 203.96MW (-4.33%) from 4,712.34MW recorded in 2022/Q1.

“The available generation was driven largely by Afam VI, Jebba, Kainji and Egbin ST power plants that recorded a reduction of -70.19MW (-41.39%), -114.12MW (-30.65%), -122.41MW (-29.73%), and – 202.73MW (-37.07%) respectively,’’ it stated.

Metering

The report, which admitted that the huge metering gap for end-use customers remains a key challenge in the industry, said a total of 167,956 meters were installed in 2022/Q2 compared to the 85,510 meters installed in 2022/Q1.

“ The huge metering gap for end-use customers remains a key challenge in the industry – it is estimated that of the 12,643,630 registered energy customers as at June 2022, only 4,898,721 (38.74%) have been metered. A total of 167,956 meters were installed in 2022/Q2 compared to the 85,510 meters installed in 2022/Q1.

“By comparison, the net metering rate increased from 37.79% metering in March 2022 to 38.74% in June 2022. The meter installations increased compared to 2022/Q1 despite the winding down of the National Mass Metering Program (NMMP) phase 02 as a result of the uptake of the MAP metering scheme by most DisCos’’, it stated.

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