The issue of estimated billing has been a challenge in the power sector with many electricity consumers across the country complaining about it due to inflated costs, lack of transparency, and being charged more than actual power consumption.
For several years, there have been protests over exploitative billing by Electricity Distribution Companies (DisCos).
Many homes that barely get electricity supply once a week are charged outrageous sums of money per month, in a billing that is not cost effective.
In some cases, the difference in charges could be as high as 500 per cent within a short time, even when there is little or no improvement in power supply.
Most affected by this exploitation are electricity consumers without pre-paid meters, as their billings are estimated.
Affected consumers have continued to complain that the high billing led to overpayments or disputes, with common complaints focusing on high charges, opaque calculations, and issues with meter installation.
They said that 11 years after privatisation; millions of them still relied on estimated billing due to the absence of prepaid meters.
According to them, estimated billing has led to “crazy billing”, charges far higher than the electricity they consume.
Mr. Princewill Okorie, Executive Director, Electricity Consumer Protection Advocacy Centre, described estimated billing as criminal, adding that it is not done according to the Nigerian Electricity Regulatory Commission (NERC) methodology.
According to him, NERC directed that transformers used in supplying electricity to those on estimated billing should have a meter to check what energy goes to a place and multiply it with the kilowatts per hour
He said that most of the distribution companies are using transformers that do not have meters because they want to exploit consumers.
“You must not give bills anyhow, you must check the meters on the transformer to know the electricity supplied to consumers.
“It is wrong for people to be paying for what they did not consume,‘’ he said.
A consumer in Lugbe Zone 7, Mrs. Mabel Osuji, said that the Abuja Electricity Distribution Company (AEDC) had not provided the area with meters, so residents pay whatever bill is giving to them.
According to her, sometimes the bill will be high other time it will be low.
“We are waiting for the pre-paid meters that government promised to roll out so that we can only pay for what we consume,‘’ she said.
Another consumer in the same area, Mr Monday Olaniyi, said that having to pay bills through estimation was not the best.
Olaniyi said that he did not know what he consumed but just keeps paying any bill given to him.
“I have applied for the pre-paid meter and I am patiently waiting for it to end this crazy bills,‘’ he said.
To solve the problem of estimated billing, the Federal Government, through NERC, issued an order capping estimated bills for unmetered customers based on feeder averages to ensure fairness.
The NERC Order on Capping of Estimated Bills is contained in Order No: NERC/197/2020.
It protects unmetered customers in Nigeria by setting maximum charges for estimated electricity bills, aligning them with actual consumption of metered users on the same feeder.
“This has led to subsequent enforcement orders and sanctions for Electricity Distribution Companies (DisCos) failing to comply, requiring credit adjustments for over billed customers
“This order repealed older regulations and mandates that Distribution Companies (DisCos) provide these caps, with specific monthly energy caps available for different feeders,” NERC said.
According to the commission, Electricity consumers do not want to pay on the basis of estimated bills, rather they want to pay for what they consume and should be provided meters in order to achieve this.
The Federal Government is currently metering electricity consumers to ensure accurate billing, end to estimated billing , reduce revenue leakages, and boost power sector transparency.
The Federal Government also seeks to improve efficiency, and restore public trust through its Presidential Metering Initiative (PMI), deploying millions of smart meters to bridge the gap, protect vulnerable Nigerians, and make the sector financially viable.
The key objectives of the FG metering initiative to end estimated billing is to eliminate the practice where consumers are billed based on assumptions rather than actual consumption.
It is also to ensure that consumers pay only for the electricity they use, promoting transparency, revenue protection help DisCos recover revenue loss to non-payment and inefficiencies.
“Ensure sector viability: enhance the financial health of the power sector to attract investment, ensure public trust and confidence in electricity providers.
The initiative would also support Local Production, and foster local meter manufacturing and job creation.
The Minister of Power, Mr. Adebayo Adelabu, said that the Federal Government had secured about N700 billion, for the rollout of two million meters annually over the next five years under the initiative.
Adelabu disclosed this at the 2025 Nigerian Energy Forum, with the theme “Powering Nigeria through Investment, Innovation, and Partnership”.
He said that the fund was obtained from the Federation Account Allocation Committee by the Federal Government.
According to him, the PMI aims to close Nigeria’s metering gap, improve transparency, and enhance the financial stability of the power sector.
He said the initiative complemented the 3.2 million meters being procured through the World Bank’s Distribution Sector Recovery Programme (DISREP), positioning the country to bridge the metering gap within five years.
The minister said that the Federal Government was leveraging bilateral funding and development finance to attract private investment and expand electricity access in underserved communities, schools, hospitals and public institutions.
“In the past two years, more than two billion dollars has been mobilised through key programmes, including the World Bank’s DARES, NSIA’s RIPLE, and the JICA fund.
“These interventions are accelerating renewable energy deployment and access to reliable power,” he said.
The Federal Government, through NERC, approved the disbursement of N28 billion to DisCos for the procurement and installation of prepaid meters under the Meter Acquisition Fund (MAF) Tranche B scheme.
NERC said that the N28 billion was for the procurement of meters for all outstanding unmetered Band A customers at no cost.
This announcement was contained in the Order on the Operationalisation of “Tranche B” of MAF issued by NERC and signed by its Vice Chairman, Musiliu Oseni, and Commissioner, Legal, Licensing and Compliance, Dafe Akpeneye,
According to the order, the funds approved under Tranche B of MAF are intended to meter all outstanding unmetered Band A customers.
They also focus on expediting the closure of the metering gap for customers currently classified under Tariff Band B
”The N28 billion shall be allocated in proportion to the respective contributions of the DisCos, and the DisCos are expected to meter all outstanding unmetered Band A customers.
”They are also required to expedite the closure of the metering gap for customers currently classified under Tariff Band B.
“Schedule 1 provides the detailed breakdown of the funds available to each DisCo for the purchase of end-use customer meters.
“All the meters to be procured and installed under the MAF framework shall be provided at no cost to the customers,” it said.
The commission said that the order seeks to establish a clear and transparent framework for the implementation of Tranche B of the MAF scheme.
It also said that the order sought to define the eligibility requirements and obligations of DisCos and Meter Assert Provider (MAP) in accessing and utilising funds.
“It prescribes the terms of financing, repayment, and utilisation of funds under the scheme.
“It also sets out the monitoring, reporting and evaluation requirements to ensure accountability, efficiency and transparency in the deployment of MAF funded meters.
”It provides operational guidelines and conditions applicable to participating entities to safeguard the integrity of the MAF scheme, ”it said.
Giving a breakdown of the releases of funds accrued under MAF, NERC explained that in April 2024, out of the accrued sum of N21.864 billion, it released N21 billion to the DisCos for the procurement of meters under tranche A of the MAF scheme.
It said that the latest is the N28 billion released under tranch B of the MAF scheme.
Also recently, NERC said that between 600,000 and 700,000 electricity meters are currently available for distribution across the country.
Its chairman, Musiliu Oseni, said this at the 4th Nigerian Electricity Supply Industry (NESI) Stakeholders’ Meeting in Abuja.
Oseni, while urging DisCos to speed up the rollout of the meters, said that government had already made the necessary investments to make the meters available.
According to him, DisCos should take the responsibility of ensuring that the meters reach customers without delay
“There are currently 600,000 to 700,000 meters available in the country. Government has made the investment, so the DisCos need to step up.”
Oseni, who also spoke on the ongoing transition to State Electricity Regulatory Commissions, called on the DisCos to fully cooperate with the new regulators, saying no operator is above regulatory oversight.
As the Federal Government and other stakeholders take steps to address the contentious issue of estimated billing through provision of prepaid meters, affected consumers urge them to expedite actions to correct the situation.
Experts are of the opinion that if more pre-paid meters are brought into the power sector, estimated billing would be a thing of the past.
By Constance Athekame, News Agency of Nigeria (NAN)