Electricity Distributors Raise Alarm Over Free Meter Directive
Electricity distribution companies across Nigeria have voiced significant concerns regarding a recent directive from the federal government mandating the free distribution of prepaid meters to consumers. The DisCos argue that the policy lacks clarity on critical financial aspects, particularly who will bear the substantial costs associated with meter procurement and installation.
Funding Ambiguity and Implementation Challenges
The DisCos have pointed out that the directive, issued by the Minister of Power, Adebayo Adelabu, fails to specify how the expenses for meter acquisition and installation will be covered. Operators emphasize that meter installers are not direct employees of the distribution companies and must be compensated for their services. This raises questions about the sustainability of the initiative without a clear funding mechanism.
Industry insiders, speaking anonymously, have described the minister's announcement as a populist statement aimed at gaining political favor rather than a well-consulted policy. They stress that the meters labeled as free would ultimately be paid for by the DisCos over an extended period, potentially up to ten years, which could strain their financial resources.
Impact on Existing Metering Schemes
The directive is already having adverse effects on the Meter Asset Providers scheme, which allows customers to purchase meters directly and receive refunds through energy credits over time. Many consumers are now rejecting the MAP option, believing that meters are entirely free for everyone, despite the limited availability of government-supplied meters.
This confusion threatens to undermine efforts to close the country's significant metering gap, as the existing scheme has been a crucial component in improving electricity billing accuracy and reducing estimated charges.
Calls for Government Clarification and Stakeholder Engagement
The DisCos are urging the federal government and the electricity regulatory body to provide clear guidelines on the following key issues:
- Who will fund the procurement and installation of the meters
- Which customer categories are eligible for the free meters
- How cost recovery will be managed to avoid accumulating debt in the sector
Operators express disappointment over the lack of consultation with relevant stakeholders before the public announcement. They warn that without addressing these financial and operational concerns, the directive could lead to increased tensions between consumers and service providers, as well as potential disruptions in the electricity distribution sector.
Background on the Free Meter Initiative
The federal government's directive is part of the Distribution Sector Recovery Programme, a World Bank-funded initiative aimed at eliminating estimated billing and providing accurate data for electricity consumption. In August 2025, the government began distributing approximately 1.3 million free prepaid meters to Band A customers, though consumers in lower bands were excluded from this initial phase.
Despite these efforts, the DisCos maintain that a more comprehensive and financially sustainable approach is necessary to ensure the long-term success of metering initiatives across Nigeria.
