Challenges Threaten the successful execution of the $155 million Phase 2 of Nigeria’s National Mass Metering Program (NMMP) is facing serious threats due to inconsistent government policies, high annual turnover requirements, and cash flow demands. The NMMP, a World Bank-funded initiative, aims to procure and distribute 1,250,000 smart electricity meters to 11 electricity distribution companies (DisCos) in Nigeria, promoting indigenous production and creating job opportunities.
Challenges Threaten While the previous administration led by former President Muhammadu Buhari prioritized indigenous production and offered incentives, the current Phase 2 of NMMP, managed by the Project Implementation Unit (PMU) of the Transmission Company of Nigeria (TCN) and supervised by the Bureau of Public Enterprises (BPE), seems to favor foreign companies over the 35 local meter manufacturers in Nigeria.
Bid guidelines for Phase 2 specify high annual turnover, cash flow, and security bid in dollars as conditions for bidders. Bidders must provide audited financial statements for the last five years, demonstrating their financial capability. Additionally, they are required to meet significant cash flow and turnover criteria for different lots.
This approach has raised concerns among local meter manufacturers and assemblers (LMMAs), who argue that meeting these conditions will be challenging and hinder the development of local content in the power sector. They believe it could reverse the progress made in the past three years through backward integration.
In response, LMMAs filed a petition and took their case to the High Court in Kano, seeking to halt TCN’s process. The intervention of the Federal Ministry of Finance led to a meeting involving various stakeholders, resulting in the formation of an inter-ministerial committee to address the concerns of indigenous producers and assemblers.
The committee found that local producers have an installed capacity of 4.5 million meters, with over 500,000 meters ready for immediate deployment and the potential for an additional 500,000 meters within two months. Despite this, TCN-PMU reopened the bid process, causing further disruption.
The situation has prompted calls for a review of the program’s implementation to ensure adherence to procurement laws and the utilization of a national competitive bidding process. Advocates also emphasize the need to work closely with local meter manufacturers and revive the Phase 1 mass metering program in collaboration with key stakeholders.
The outcome of these challenges will be crucial in determining the future of Nigeria’s National Mass Metering Program and its impact on the power sector, local content development, and job creation.
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