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Meters: Electricity Consumers to Pay through Service Charge

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Electricity
  • Meters: Electricity Consumers to Pay through Service Charge

Contrary to the position of the Nigerian Electricity Regulatory Commission (NERC) that electricity consumers in the country would be provided meters free-of-charge by their distribution companies (Discos), power consumers would actually have to pay for such through a new window termed ‘metering service charge,’ Investors King yesterday learnt.

Checks revealed that Discos’ customers can either choose to pay upfront for meters to be installed at their premises by Disco-accredited MAPs, or accept an installation by the Discos with an agreement to pay for it through their electricity bills.

NERC recently stated that the responsibility of providing meters to consumers was still that of Discos. It also disclosed that under the MAPs scheme, consumers who choose to self-finance their meter acquisition would pay the MAPs N36,991.50 for single phase meters and N67, 055.85 for three phase meters respectively.

It has so far approved the MAPs accredited by Abuja; Ibadan; Ikeja and Jos Discos to commence operations.
However, it is not clear if the new meter service charges in the MAPs scheme are different from the fixed charge the NERC in 2015 abolished and striped Discos from collecting from consumers.

Efforts to reach the General Manager, Public Affairs, Dr. Usman Arabi, and Head of Media, Mr. Sam Ekeh, of the NERC for clarification on the content of the regulation proved abortive as none of them responded to calls and text messages as at the time of filing this report.

NERC had also stated that the main objective of the MAPs would be to encourage the development of independent and competitive meter services in the power market, eliminate estimated billing, attract private investment in metering services, close the huge metering gap, and then improve the revenue generation profile of the sector.
According to it, the Discos’ metering gap as at December 2017 was 4,740,275, which it said could significantly increase upon the conclusion of a customer enumeration exercise.

Based on MAPs regulation, all Discos are expected to engage the services of MAPs towards meeting their metering targets.

It added that 30 per cent of the contracted meters to be installed by the MAPs would be locally sourced.
Also, consumers who do not have meters yet shall provide access for the provision of meters for their premises by MAPs, failure for which would result in a denial of electricity service by the Discos.

The document further said: “The distribution licensees shall include a metering service charge as a clear item on the billing of its customers provided with meters under an MSA (meter service agreement) with MAPs and shall be separate from the energy charge. The metering service charge shall be based on the outcome of the procurement process for the MAP and subject to the approval of the commission.”

It said that when this is the case, the Discos shall have rights to use data derived from customer meters for monitoring, billing planning and any other related activities, as well as to query data from the meters for audit purposes.

Further, the regulation explained that: “The metering service charge paid by all customers shall be ring-fenced in a dedicated account for the purpose of timely payment to MAPs,” adding that the MAPs shall retain the right to be paid in full the aggregated metering service charge paid by customers during the billing cycle.

Dwelling on obligations of parties under the scheme, the regulation stated that: “Upon the installation of a meter by a MAP, the customer has no obligation to pay for metering service charge through the distribution licensee at the time of payment for energy unless financed upfront in full by the customer.

“The payment for metering service charge by the customer to the MAP shall cease upon full amortisation of the meter asset over its technical life assumed in the procurement process for the MAP.”

According to it, where a customer fails to pay for metering service charge in any given month or months, the cumulative metering service charge shall be deducted upon the subsequent payment.

Equally, where a customer elects to pay for a meter asset upfront under the regulation, such a customer shall not be liable for the payment of metering service charge through the Discos.

“The amount payable to the MAP by a customer electing to pay upfront shall be the efficient cost of the meter asset and its installation cost as determined by the procurement process for the MAP conducted by the distribution licensee,” it added.

As for the obligations of the MAPs and Discos in the arrangement, it stated that after initial installations of meters, the MAPs shall repair or replace them within two working days of being notified they are faulty.

“Where a MAP fails to repair or replace a meter within two working days of a report by the customer or distribution licensee, the customer shall not be liable for the payment of metering service charge for the billing period unless such delays were as a result of inaccessibility to the customer’s premises.

“In the event of a prolonged delay in repairing or replacing a defective meter asset, the distribution licensee and MAP shall agree on an appropriate compensation to the distribution licensee for loss of revenue.

“The MAP shall install the meter at the premises of the customer within 10 working days of the receipt of full payment by the customer. The authorisation by the distribution licensee to pay for the meter shall only be issued after certifying the readiness of the premises for a safe and secure installation of the meter asset,” according to the regulation.

The regulation also provides that the cost structure of metering service charge shall cover the cost of providing the meter asset and the ongoing costs of operating and maintaining them, and would be transparent in the billing processes.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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MicroStrategy Rally Crushes Short Sellers, Wiping Out $1.92 Billion

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MicroStrategy- Investors King

Short sellers betting against MicroStrategy found themselves facing significant losses as the company’s rally wiped out $1.92 billion since March.

This development comes amidst a rally that has seen MicroStrategy’s stock outperform bitcoin, causing a considerable hit to those who had taken a bearish stance on the tech firm.

According to data from S3 Partners, short sellers have been on the losing end since March, as MicroStrategy’s stock surged, highlighting the impact of the rally on those betting against the company’s success.

This loss underscores the challenges faced by short sellers in a market where certain stocks experience rapid and unexpected price increases.

The rally in MicroStrategy’s stock is attributed to several factors, including the approval of several spot bitcoin exchange-traded funds (ETFs) by the Securities and Exchange Commission (SEC) earlier in the year.

This move by the SEC brought bitcoin, a once-nascent asset class, closer to the mainstream and fueled investor interest in companies like MicroStrategy, known for their significant holdings of the cryptocurrency.

MicroStrategy, which held nearly 190,000 bitcoin on its balance sheet as of the end of 2023, has indicated its intention to continue increasing its exposure to the digital currency.

The company’s decision to sell convertible debt to raise money for additional bitcoin purchases further bolstered investor confidence and contributed to the stock’s rally.

Analysts at BTIG noted that the premium for MicroStrategy’s stock reflects investors’ desire to gain exposure to bitcoin indirectly, especially those who may not have the means to invest directly in the cryptocurrency or ETFs.

The company’s ability to raise capital for bitcoin purchases is seen as a positive sign for shareholders, adding to the optimism surrounding its stock.

However, despite the recent rally and optimism surrounding MicroStrategy, the crypto industry as a whole continues to be heavily shorted.

Short interest in nine of the most-watched companies in the crypto space remains high, standing at 16.73% of the total number of outstanding shares, more than three times the average in the United States.

Moreover, concerns persist regarding the SEC’s stance on cryptocurrencies, with some experts suggesting that the approval of spot bitcoin ETFs may not necessarily indicate a broader acceptance of other similar products, such as spot ethereum ETFs.

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Geregu Power Plc Announces N14.46bn Profit in Q1 2024

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Geregu Power Plc

Geregu Power Plc has announced a profit of N14.46 billion for the first quarter (Q1) of 2024.

This represents a 307% increase when compared to the same period last year.

The power-generating company, known for its pivotal role in Nigeria’s energy sector, disclosed its outstanding financial results in its interim financial statement filed with the Nigerian Exchange Limited on Tuesday.

This disclosure comes shortly after the firm’s Deputy Chief Executive, Julius Omodayo-Owotuga, hinted at the promising financial outlook during the company’s recent annual general meeting held in Lagos.

According to the interim report, Geregu Power Plc’s revenue surged to N50.42 billion in the first quarter of 2024, representing an increase of 254.37% year-on-year appreciation.

The company’s net finance income transitioned from a negative position to N133.61 million. This positive momentum was supported by a moderation in finance costs, which decreased from N3.141 billion to N2.29 billion as of March 2024.

Speaking to stakeholders at the recent annual general meeting, Femi Otedola, Chairman of Geregu Power, expressed satisfaction with the company’s exceptional financial performance in 2023.

Otedola highlighted the board’s decision to propose a dividend distribution of N8 per share for the 2023 financial year as a testament to their commitment to rewarding shareholders and confidence in the company’s future prospects.

The robust financial results for the first quarter of 2024 further solidify Geregu Power’s position as a leading player in Nigeria’s energy landscape.

The company’s commitment to operational excellence, strategic investments, and adherence to international standards, such as obtaining ISO 9001 and 14001 certifications from the Standard Organisation of Nigeria, underscores its dedication to driving sustainable growth and value creation.

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Guaranty Trust Holding Company Plc Records N609.3bn Profit Before Tax in 2023

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GTCO Commemorates Listing on Nigerian Exchange - Investors King

Guaranty Trust Holding Company Plc (GTCO) has announced a strong profit before tax (PBT) of N609.3 billion for the 2023 financial year.

This represents an increase of 184.5 percent when compared to the previous year.

The audited consolidated and separate financial statements filed with the Nigerian Exchange Group and London Stock Exchange on Monday revealed market capitalization exceeded N1 trillion on the NGX to further solidify GTCO’s position as one of the top financial holding companies in Nigeria.

During the period under review, the group’s post-tax profit rose by 218.99 percent to N539.65 billion from N169.17 billion in 2022.

Key indicators such as loans and advances increased by 31.5 percent to N2.48 trillion, while deposits grew by 63.7 percent to N7.55 trillion.

The group’s total assets and shareholders’ funds closed at N9.7 trillion and N1.5 trillion, respectively.

Despite the challenging economic environment, GTCO maintained a strong capital adequacy ratio of 21.9 percent.

Also, the group sustained asset quality, with IFRS 9 Stage 3 loans improving to 4.2 percent in December 2023 from 5.2 percent in the same period of the prior year.

However, the cost of risk experienced an uptick, rising to 4.5 percent from 0.6 percent in December 2022, largely due to worsening macroeconomic factors.

Despite these challenges, GTCO’s pre-tax return on equity stood at 50.6 percent, while pre-tax return on assets was 7.6 percent. The cost-to-income ratio remained favorable at 29.1 percent.

Commenting on the financial results, Mr. Segun Agbaje, the Group Chief Executive Officer of GTCO, expressed satisfaction with the company’s performance amidst a challenging operating environment.

He attributed the strong performance to the successful implementation of the group’s business model across banking and non-banking business verticals.

“Also important to our success is our relentless obsession with innovation and offering great customer experiences as demonstrated by the successful redesign and upgrade of our mobile banking application, GTWorld,” he stated.

“In a landscape characterised by evolving regulatory reforms, global uncertainties, and heightened competition, we have continued to leverage our inherent strengths and capabilities to unlock significant value, creating more opportunities for the businesses and individuals we serve.

In line with its commitment to shareholders, GTCO announced a final dividend of N2.70k, bringing the total dividend for 2023 to N3.20k.

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