Effect Of Devaluation Of The Naira: Electricity Meters Now Sell For N60,000

The cost of acquiring pre-paid electricity meters by consumers in the country has risen due to the fall in the value of the naira following the currency’s recent devaluation by the Central Bank of Nigeria. A single-phase meter, according to findings by our correspondent, can now be obtained for N39,375, while the three-phase meter now goes for N60,909. Before now, the single-phase and three-phase meters were selling for N25,000 and N50,000.

However, with the latest development, the cost of the single-phase meter has risen by 56%, while that of the three-phase meter has jumped by 20%. This means that household electricity consumers, who are majorly the users of single-phase meters, will pay more for the devices in relative terms compared to the users of the three-phase meters.

It was gathered that the price increase was because most of the meters in the Nigerian electricity market were imported and that the rising exchange rate of the naira to the United States dollar was posing a huge problem to importers of the product.

Confirming the current cost of the meters, the spokesperson for the Eko Electricity Distribution Company, Mr. Godwin Idemudia, said, “The single-phase smart meter is N39,375, while three-phase meter is N60,901,” adding that the company was no longer installing ordinary prepaid meters.

The spokesperson for the Ikeja Electricity Distribution Company, Mr. Pekun Adeyanju, disclosed in an interview that the company had not commenced its metering programme yet; but was looking at starting it on or before May. He said the company was taking its time to ensure that the meters it would introduce to customers met global standard and could stand the test of time.

The Managing Director/Chief Executive Officer, Powercap Limited, Mr. Biodun Ogunleye, said in a telephone interview that because Nigeria was largely a foreign currency regulated economy, the devaluation of the naira would affect imported commodities, electricity meters inclusive.

“A lot of inputs have to be imported, and ultimately, those inputs will be passed onto the consumers at the cost plus margins. As a result, the costs of bringing in meters will go up; and there is nothing anybody can do about it.

“It is a priority that must be implemented because the people who are operating in the market will be interested in maximising their revenue. They will not want to encourage any form of income leakages.”

He said by this, whatever pricing the Nigerian Electricity Regulatory Commission had fixed would be revisited because it had a little choice as far as granting a review was concerned.

“We have one or two local plants that can produce meters. The high foreign exchange may prompt the government to intervene, and thus make the business more profitable.

“But bear in mind that when it comes to meters like many other electronics, the specification and a couple of other factors between the distribution companies and the meter manufacturers must be adhered in order to drive patronage.”

Culled from: Punch