NERC Mulls Prepaid Meter Price Hike Amidst Rising Production Costs

The Nigerian Electricity Regulatory Commission (NERC) is reportedly contemplating another increase in the price of prepaid meters due to escalating production costs faced by manufacturers. Sources familiar with the matter revealed to Nairametrics that NERC might even opt to let market forces determine meter prices, a departure from the current regulatory pricing.

The potential price hike is attributed to the foreign exchange crisis, which has led to increased production costs and inflationary pressures on manufacturers. As a result, manufacturers have stopped issuing invoices to Distribution Companies (Discos) in anticipation of a price revision by NERC.

The uncertainty surrounding meter prices has also affected the processing of new meter applications, with indications that NERC will soon announce a new pricing rate. This delay has left many applicants without access to prepaid meters, despite some having paid for them.

A Distribution Company official explained, “The cost of prepaid meters is going to go up soon…New meter applications are not being processed until the price changes are reflected.” However, customers who have already paid for their meters are expected to receive them without additional charges, regardless of any new pricing.

The Manufacturers Association of Nigeria (MAN) has previously reported that the forex crisis and high inflation rate are limiting the manufacturing sector’s performance. Average capacity utilization is expected to hover around 50% due to these challenges, impacting manufacturing output.

In September 2023, NERC had previously increased the price of prepaid meters, with a single-phase meter costing N81,975.16 and a three-phase meter priced at N143,836.10. With the current inflation rate and depreciation of the Naira, consumers could potentially be paying over N100,000 for a single-phase meter and around N150,000 for a three-phase meter if a new price review occurs.

Nairametrics