The Association of Meter Manufacturers of Nigeria (AMMN) has expressed its opposition to the World Bank-funded bid process for the supply and installation of 1.2 million smart electricity meters to the 11 distribution companies (Discos) under Phase 2 of the National Mass Metering Programme (NMMP).
In a letter addressed to the Director General of the Bureau of Public Procurement (BPP) and made available to the public, the association called for an immediate suspension of the World Bank-funded bid process.
AMMN calls on FG to respect contract agreements with its members
The association urged the BPP DG to direct the Transmission Company of Nigeria (TCN), the Nigerian Electricity Regulatory Commission (NERC), and the Central Bank of Nigeria (CBN) to honour the pending contract for the supply of four million meters awarded to its members since November 2022 under Phase 1 of the NMMP.
The group noted that the World Bank-funded bid process, recently advertised by the TCN, favoured foreign firms without a track record of investment in the country and contradicted the federal government’s backward integration policy.
They cautioned thus “Tender, which closes on July 11, 2023, if left to continue, would amount to a constructive breach of the award of contract(s) for the supply of four million meters under Phase One of the programme already awarded to some of its members since November 2022 by TCN, a bid process that your office approved”
Meter importation goes against the backward integration policy of the FG
- The letter further reads, “These importers, who are primarily foreigners, have yet to make a verifiable investment in the backward integration programme of the federal government, nor have they made any investment in local manufacturing and assembling of meters in Nigeria, which has always been the standard requirements for Meter Assets Providers (MAP) in Nigeria to show proof of investments in the backward integration and must have Meter Assembling/Manufacturing Plants and factories in Nigeria.”
- “You may further be reminded that TCN and NERC, under Phase 1 of the Mass Metering Project of the Federal Government, a bidding process that your office supervised and gave a “Letter of No Objection to”, awarded 4 million meters to the local meter manufacturers in 2022.”
To prevent the collapse of the local metering sector and protect Nigerian investments and jobs, the association called on the BPP DG to suspend the TCN bid process for Phase 2 and consult with stakeholders in the power sector, especially the meter manufacturers. They also urged the BPP boss to ensure the contracts for the supply of four million meters awarded to local meter manufacturers in Phase 1 were honoured.
Calls on BPP to consult with local stakeholders
Furthermore, the association requested the BPP CEO to facilitate consultations among local stakeholders during the suspension of Phase 2 and restructure the evaluation criteria and guidelines to prioritize local meter manufacturers, aligning Phase 2 with the Local Content Policy and Backward Integration Programme laws of Nigeria to stimulate economic growth.
While acknowledging the good intentions of TCN and NERC to address the metering gap and electricity challenges in Nigeria, the association emphasized the importance of upholding contractual agreements and considering the economic state of the country. They stressed that policies should encourage local production capacity to generate employment opportunities.
World bank funded bid process will lead to job losses
The association warned that the proposed World Bank-funded bid process would have disastrous consequences for its members and the local meter manufacturing and assembling companies in Nigeria. It highlighted that over $500 million had been invested in the industry and that the bid process would result in significant job losses, impacting both direct and indirect employment.
- “Our members have invested considerable resources in the metering sector with capacities to improve if only Government could sustain its present policy of allowing only genuine local meter manufacturers and assemblers to continue to supply meters to the Discos without skewed tender processes like the proposed World Bank Bid that seems to shut out local manufacturers from even participating in the process,” the association said