Contact Us

For Marketing, Sales and Subscriptions Inquiries
2637 E Atlantic Blvd #43110
Pompano Beach, FL 33062
USA

Conference List

Journal of Social Economics Research

May 2014, Volume 1, 5, pp 97-107

Metered and Unmetered Billing: How Asymmetric are the Phcn Bills?

C. Chris Ofonyelu

,

Eguabor, R. E.

C. Chris Ofonyelu 1
Eguabor, R. E. 2

  1. Economics Department, Adekunle Ajasin University, Akungba Akoko 1

  2. Rufus Giwa Polytechnic, Social Sciences Department; Owo, Ondo State 2


Abstract:

This study provides evidence on the existence of asymmetries in the metering of electricity by the Power Holding Company of Nigeria (PHCN) between January 2005 and November, 2013.Using Chiappori-Salanie correlation statistics and data from the response of 720 electricity consumers and 524 PHCN bills within the Benin Electricity Distribution Company, the study observed that the electricity bills were asymmetric. The asymmetries were observed for both the metered and unmetered consumers over the period. For the metered consumers, the asymmetry was more prevalent for the analogue than the prepaid meter users. The asymmetry existed mainly through procurement of meter in the case of the prepaid meter users. The study argues that estimated billings by the PHCN give room for asymmetry and overprices energy consumptions. The study suggests a prepaid metering of all electricity consumers in Nigeria.
Contribution/ Originality

Keywords:


Reference:

  1. Abubakar, S.M., 2009. Design and construction of a computer based power billing system. Published dissertation, federal university of technology, Minna, Niger State, Nigeria. Amadu Bello Univeristy Journal of Technology, 13(1): 39-46.
  2. Amadi, S., 2013a. NERC threatens distribution firms on prepaid meters. Available from http://www.nigeriancurrent.com/business-news/item/3531-nerc-threatens-distribution-firms-on-prepaid-meters.html [Accessed 23/10/2013 ].
  3. Amadi, S., 2013b. FG cautions new power firms owners against crazy bills. Available from http://www.nigeriancurrent.com/business-news/item/4915-fg-cautions-new-power-firms-owners-against-crazy-bills.html [Accessed 23/10/2013].
  4. Chiappori, P. and B. Salanié, 2000. Testing for asymmetric information in the insurance markets. The Journal of Political Economy, 108(1): 56-78.
  5. Dobbie, W. and P.M. Skiba, 2012. Information asymmetries in consumer credit markets. Evidence from Payday Lending. Available from www.people.fas.harvard.edu/~dobbie/.../InfoAsym_Feb2012.pdf [Accessed 28/01/2013].
  6. Edelberg, W., 2004. Testing for adverse selection and moral hazard in consumer loan markets. Federal Reserve Working Paper.
  7. Multi Year Tariff Order, 2012. Available from http://www.nercng.org/index.php/document-library/func-startdown/50/ [Accessed 25/10/2013].
  8. Ofonyelu, C.C. and R.S. Alimi, 2013. Perceived loan risk and ex post default outcome: Are the banks’ loan screening criteria efficient? Asian Economic and Financial Review, 3(8): 991-1002.
  9. Ogun, O. and C.C. Ofonyelu, 2012. Determinant of asymmetric risks in Nigerian loan market: Any dichotomy between the banks and borrowers’ perspectives? African Journal of Economic Policy, 19(2): 27-40.
  10. Ogun, O. and C.C. Ofonyelu, 2013. Asymmetric information problems in the Nigerian banking industry: Any scope for institutional reforms? Paper Presented at the 54th Annual Conference of the Nigerian Economic Society, between September 17-19, at Sheraton Hotal and Towers, Abuja.
  11. Okafor, C., 2013. Metering accounts for 80% of consumer complaints.Thisday.  [Accessed 29 October].
  12. Olusola-Obasa, B., 2012. Ccus to address complaints over-estimated billing. Available from http://www.punchng.com/feature/power-talkback/ccus-to-address-complaints-of-over-estimated-billing [Accessed 06/11/2013].
  13. Usman, A., 2013. Determinant of electricity consumer satisfaction in selected electricity distribution zones in Nigeria: Implications for regulatory activities. Journal of Asian Business Strategy, 3(6): 103-124.
  14. Sharpe, S.A., 1990. Asymmetric information, bank lending and implicit contracts: A model of consumer relationships. Journal of Finance, 45: 1069-1087.

Statistics:

Google Scholor ideas Microsoft Academic Search bing Google Scholor

Funding:

Competing Interests:

Acknowledgement:


Related Article