FG allocates N700bn for free electricity meter distribution

The Federal Government has earmarked N700 billion from the federation account to fund the distribution of free electricity meters under the Presidential Metering Initiative (PMI), according to Bolaji Tunji, the Special Adviser to the Minister of Power on Strategic Communications and Media.

IDOMA VOICE gathered that Tunji confirmed that the PMI remains on track, with a target to deliver two million meters annually. He also disclosed that the N700 billion set aside for the project is now available, and procurement for the meters has already begun.

“The Presidential Metering Initiative is progressing as planned,” Tunji said. “We aim to deliver two million meters every year, and the first batch of meters will begin delivery in the first quarter of next year. The provision of N700 billion has been made, and the funds are ready.”

Tunji also announced that the government will fulfill its commitment to deliver 1.3 million meters of the 3.2 million meters under the World Bank Distribution Sector Reform Programme (DISREP) this month.

“The DISREP programme will commence this month,” he added.

An analysis of the Federal Account Allocation Committee (FAAC) meeting minutes between April and August revealed that the government had saved N420 billion from monthly deductions of N100 billion. These funds, deducted from the monthly federation revenue before distribution to the three tiers of government, are designated to close the country’s metering gap, which currently stands at 50 percent.

In April, N120 billion was deducted from the revenue as the first tranche for the PMI, bringing the total amount deducted for the initiative to N420 billion by August.

In May, the Minister of Power, Adebayo Adelabu, announced that an initial N75 billion would be provided as seed capital for the initiative. The Nigerian Sovereign Investment Authority also pledged to contribute N250 billion annually, while the initiative will leverage debt financing from various financial institutions.

Victor Ojelabi, the Managing Director of Abuja Electricity Distribution Company, recently stated that the PMI could unlock up to N1 trillion in revenue tied up in the Nigerian Electricity Supply Industry due to the high number of unmetered customers.

The Nigerian Electricity Regulatory Commission (NERC) approved N21 billion for the 11 electricity Distribution Companies to provide meters to end-use customers at no cost under the initiative.

The Distribution Sector Recovery Programme, which is a key part of the government’s efforts, aims to address the challenges and inefficiencies in Nigeria’s electricity distribution sector.

Despite the installation of 3.03 million meters since the power sector was privatized in 2013, NERC acknowledged that the country’s metering gap remains significant. As of 2024, only 6.15 million out of 13.33 million registered customers have been metered, resulting in a metering rate of 46.14 percent.