The Nigerian Electricity Regulatory Commission (NERC) has imposed a hefty fine of N200 million on Abuja Electricity Distribution Plc (AEDC) for failing to comply with the latest tariff regulations outlined in the April 2024 Multi-Year Tariff Order. This penalty follows a breach of the supplementary order, as announced by the regulatory body on Friday, April 2024.
AEDC’s violation stems from its failure to adhere to the customer classification bands for tariff billing. The company had erroneously applied the newly updated tariffs across all customer bands, which was in direct contradiction to the stipulations set by NERC. The tariff adjustments were specifically designed to ensure fairness in billing and to prevent overcharging, particularly among customers in lower tariff bands.
NERC’s Vice Chairman, Musiliu Oseni, had previously clarified that the latest tariff adjustments were only intended to impact Band A customers, who make up 15% of the total customer base. Meanwhile, customers in Bands B to E, which account for the remaining 85%, were not supposed to be subject to the new tariff rates.
As a result of this oversight, AEDC has been instructed to refund all affected customers in Bands B, C, D, and E who were overcharged due to the improper tariff application. The company is also mandated to reimburse customers with the appropriate token balances that correspond to the correct tariff bands. The refunds are required to be processed and issued to the affected customers by April 11, 2024.
The NERC’s decision emphasizes its ongoing commitment to protecting the rights of electricity consumers and ensuring transparency and fairness within the electricity distribution sector. By imposing such a significant penalty and mandating the reimbursement of overcharged amounts, the commission is sending a clear message to other distribution companies that non-compliance with regulations will not be tolerated.
AEDC attributed the overcharging to a system error related to the reclassification of some Band A customers, who were recently moved to Band B due to changes in their electricity supply patterns. This issue resulted in inaccurate billing for several customers across different bands.
The NERC’s actions reinforce the importance of accurate billing practices in Nigeria’s electricity sector. Overcharging not only places an undue financial burden on consumers but also undermines trust in electricity providers. Therefore, it is crucial for distribution companies (DisCos) to focus on proper metering, accurate billing, and customer service.
