Nigeria’s Power Sector: Government Pledges to Address Metering Gaps and Financial Challenges

The Federal Government has reiterated its commitment to addressing metering gaps and financial liquidity challenges in Nigeria’s power sector. Olu Verheijen, Special Adviser on Energy to President Bola Tinubu, made this pledge at the 2024 edition of CERAWeek by S&P Global in Houston, United States. The event, themed “Energizing Tomorrow: Charting a successful path for Africa’s energy transition,” featured discussions on leveraging technology to enhance electricity supply.

Verheijen highlighted the government’s strategy for decentralizing transmission and using various technologies to boost electricity supply, particularly for high-demand customers. She also discussed innovative measures to derisk the power sector and stimulate investment, considering the substantial investment requirements identified by the International Energy Agency.

One key initiative involves enhancing transmission capacity without the complete $10 billion initially estimated, using digital technology and smart meters to transform 6 million customers into paying clients. This approach aims to increase revenue, improve the financial health of public utilities, and attract further investment.

Verheijen emphasized the importance of closing the metering gap and resolving financial liquidity issues to mitigate risks, attract capital, extend access, and foster greater electricity consumption. The government aims to be strategic in its interventions within limited fiscal space to achieve these objectives.

The article also notes that the 11 power distribution companies secured a total of N53.3 billion in credit facilities from the Central Bank of Nigeria’s National Mass Metering Programme, aiming to address the metering shortfall and end estimated billing practices. The initiative has installed over 883,511 meters as of September 2023, leading to increased revenue collection for Discos.

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