Discos’ Collections Rise to N831bn in Two Years

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  • Discos’ Collections Rise to N831bn in Two Years

Electricity consumers who are hooked on to the national grid paid N831 billion to the Distribution Companies (Discos) out of about N1.3 billion worth of electricity that was sent to their homes and offices between the second quarter of 2017 (Q2 2017) and first quarter of 2019 (Q1 2019).

According to the records obtained, the 10 Discos were Abuja, Benin, Eko, Enugu, Ibadan, Ikeja, Jos, Kaduna, Kano and Port Harcourt. Yola Disco which is now under the management of the federal government having gone back to it on account of a force majeure earlier declared by its private operator, was not covered by the report.

It showed that between the period – Q2 2017 and Q1 2019, the Discos received 52,185 gigawatt hour (GWh) of electricity from the grid and billed their customers for 40,901 GWh of electricity sent to them.

The total worth of the billed electricity to the consumers, the report showed was N1.3 trillion for the period, but N831 billion was realised. It explained the Discos within the period, improved on their revenue collection efficiency, which rose from 62 per cent in Q2 2017 and Q1 2018, to 66 per cent in Q2 2018 and Q1 2019.

“The total energy collection (across the 10 Discos) increased by N61 billion more, as compared to the previous 12 months (+16 per cent). This is mainly due to improved performance (+12 per cent), as well as the incremental energy received (4 per cent). In this quarter, in general, Discos have increased their revenue collection,” the report obtained from the Discos trade association – Association of Nigerian Electricity Distributors (ANED) showed.

“Overall, the ATC&C (Aggregate Technical Commercial and Collection) keeps reducing and reached a new low in February 2019 (47.2 per cent) versus a starting point of 56 per cent, on set of privatisation,” it added.

According to it, in Q1 2019, energy received increased for five Discos but decreased for the other five Discos which were not named in the report.

It equally stated that between 2016 and Q1 2019, the Discos’ average revenue collection efficiency has improved from a low of 47.8 per cent to 68.4 per cent.

“Overall, the amount of revenue collected increased immensely (+16 per cent), as well as energy billed (+7 per cent), which summarises that the performance improvement of Discos is not only due to the benefit of receiving more energy (+4 per cent),” it added.

Furthermore, showing the distribution, the report noted that between Q2 2017 and Q1 2018, the total energy billed by Discos was 19,741GWh which was equivalent to N628 billion, and from which N385 billion was collected. Between Q2 2018 and Q1 2019, the total energy billed was 21,160GW, equivalent to N672 billion, and from which N446 billion was earned.

For Q1 2019, it said the total amount of energy billed was 5,576.8GWh, equivalent to N176.5 billion, and from which N114.6 billion was also collected from consumers.

Based on a moving average, it explained that since July 2016, there had been a gradual rise in both energy received by Discos and, consequently, in the energy billed.

It further stated: “Although the retail tariff has remained unchanged since Feb 2016, the revenue collection has been increased continuously, up by almost N40 billion in March, compared to the average of N24 billion per month in 2016. This is a consequence of improved Disco performance.

“The energy received by ANED´s members have increased by 7 per cent in the last quarter compared to the previous one and in some Discos the increase is above 10 per cent.”

While calling for an improved rapport with the Transmission Company of Nigeria (TCN) on proactive energy management, the Discos in the document stated: “It is important to better understand the reasons behind these variations to avoid decreasing scenarios, while in parallel, there is an urgent need to improve the energy management communications between TCN and Discos on daily basis.

“Until this operational coordination is completed, Discos might face erratic scenarios that negatively affect the evolution of their KPIs (Key Performance Indicators), under their PIPs (Performance Improvement Plans).”

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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