Nigeria’s electricity distribution companies have pushed back against a directive by the federal government requiring prepaid meters to be installed free of charge for all customers, questioning how the policy will be funded and implemented.
Operators, who spoke on condition of anonymity because of the sensitivity of the issue, said the order by Power Minister Adebayo Adelabu amounted to a political declaration made without adequate consultation with key stakeholders, including meter providers and installers.
On Thursday, the federal government barred distribution companies and installers from collecting any payment for meters, warning that officials found extorting customers would be prosecuted. Adelabu issued the warning during an inspection of newly imported smart meters at APM Terminals in Apapa, Lagos.
The minister said the meters were procured under the World Bank–funded Distribution Sector Recovery Programme and must be installed for consumers at no cost, regardless of customer tariff band. Any demand for payment, he said, would constitute an offence.
“It is unprecedented that these meters are to be installed and distributed to consumers free of charge,” Adelabu said. “Nobody should collect money from any consumer. It is an illegality. It has to be installed free of charge so that billing and collections will improve for the sector.”
DisCo officials, however, said the meters described as free would ultimately be paid for by the distribution companies over a 10-year period, arguing that the policy effectively shifts the financial burden to them without regulatory adjustments.
“Someone has to pay for the meters,” a DisCo official said. “The government expects DisCos to carry the cost over 10 years. Any capital expenditure must be treated as allowable capex and reflected in tariffs, otherwise it damages the companies’ balance sheets.”
Operators also questioned who would pay independent meter installers, noting that they are not employees of the distribution companies.
“Installers are already asking who will pay them if consumers are barred from paying,” another operator said. “The DisCos are not the ones installing meters. That responsibility was removed from us years ago. If government wants meters installed free, then it must clearly state who pays the installers.”
The operators warned that without a clear funding framework, the directive could face implementation challenges in the coming weeks.
