Residents of Oworonshoki, Lagos, have accused the Ikeja Electric (IE) (formerly known as Ikeja Electricity Distribution Company – IKEDC) of fraudulent billing practices, alleging that the company has been extorting customers despite regulatory directives.

Speaking to SaharaReporters, residents claimed that IE had been phasing out Unistar prepaid meters and placing affected households on commercial billing—despite clear directives from the Nigerian Electricity Regulatory Commission (NERC) and the Federal Competition and Consumer Protection Commission (FCCPC) prohibiting such actions.

Seun Gbogboade, Chairman of the Oworonshoki Electricity Forum, revealed that this practice has been ongoing for two years, leading many customers to falsely believe they are indebted to IE. In reality, he said, many have overpaid and should have credit balances.

“One of their fraudulent practices is placing residential customers on commercial billing,” Gbogboade stated. “Oworonshoki is a residential area, yet IE classifies customers under the Maximum Demand (MD) tariff, which is meant for high-consumption businesses and industries. This results in inflated electricity bills.”

The affected residents are calling on NERC and FCCPC to enforce their directives and hold IE accountable for alleged fraudulent practices.

Seun said, “We have a platform in our community called the Oworonshoki Electricity Forum, where we discuss and understand electricity regulations. We have read the Customer Protection Regulations and other relevant laws, so we know the rights of consumers under IE.

Lagos Community Residents Accuse Ikeja Electric Of Overbilling And Extortion, Allege Defiance Of Regulatory Directives

“IE deliberately places customers on the MD category so they can overbill them. This is because every month, NERC (Nigerian Electricity Regulatory Commission) sets a billing cap for each community feeder, which is publicly available online.

“For instance, our community’s cap usually ranges between 500 and 650 kilowatt-hours (kWh). However, instead of adhering to this limit, IE assigns some customers an MD tariff and bills them for up to 9,000 kWh instead of the allowed 650 kWh.

“For example, at a tariff rate of ₦50 per kWh, a 9,000 kWh bill amounts to over ₦400,000 instead of the appropriate ₦32,500 for 650 kWh. Some customers even receive bills for 12,000 kWh. Many people are unaware that NERC has capped their billing, and IE is not authorized to place residential customers on commercial rates.”

Seun told SaharaReporters that another major issue is that commercial customers cannot apply for prepaid meters.

He said if a customer is placed on a commercial plan, they cannot successfully apply for a prepaid meter through the IE portal. This forces them to continue paying inflated bills indefinitely.

“I have taken IE to NERC several times, and NERC has ordered them to reverse these fraudulent charges. For example, some customers have been wrongly billed under the commercial category since 2021,” he said.

The chairman of Oworonshoki Electricity Forum further explained that NERC directed IE to refund over ₦2 million in excess charges to some residents, but IE only refunded about ₦500,000 while ignoring the rest.

He said, “Customers then have to keep fighting for their rightful refunds.

“There is also the issue of the Unistar meter. Last year, NERC and the FCCPC (Federal Competition and Consumer Protection Commission) instructed IE not to remove functional Unistar meters.

“However, IE still phased them out and started billing customers using estimated commercial tariffs. I had to escalate the matter to NERC, and they acknowledged that IE had overbilled a customer by ₦1.6 million within a year.

“In response, IE falsely claimed in an official message that they had refunded the ₦1.6 million. However, the very next day, they sent a new bill of over ₦400,000 to the same customer. IE repeatedly ignores NERC directives because they know it is difficult for customers to keep returning to NERC for enforcement.

“Last year alone, I helped recover over ₦25 million for residents in our community who had been overbilled. This year, I have already helped recover over ₦5 million. Many people don’t know that NERC has placed billing caps on their electricity charges, so they simply accept and pay whatever bill they receive without questioning it.

“This issue has not been widely covered in the media, which is why I have shared evidence of NERC’s rulings against IE. Despite being instructed to refund customers, IE continues to delay compliance.

“Last month, part of our community was illegally placed in Band A instead of Band C. When we petitioned NERC for a downgrade, I also raised the issue of IE’s illegal placement of residential customers on commercial plans. NERC officials and IE’s legal representatives were present, and NERC asked IE to justify why they placed customers in the MD1 (commercial) category.”

Seun told SaharaReporters that according to IE’s own criteria, a customer must have a load of at least 45 kVA to be classified as MD1.

When NERC asked if any of these residential customers met this requirement, it was learnt that IE admitted that they did not. NERC then instructed IE to remove all affected customers from MD1 billing.

However, he said that IE has not complied, as it continues to send bills of ₦800,000 to ₦900,000 to households that should be receiving ₦100,000 bills.

He said, “This fraudulent practice has been ongoing for two years. Many residents wrongly believe they are in debt to IE, but in reality, IE has been extorting them. Legal action would likely reveal that many customers have been overpaying and should actually have credit balances.

“One notable case I handled involved a woman who bought a house in December. After purchasing the property, she visited IE to set up her account, only to be told that the previous owner owed ₦1.2 million.”

Seun alleged that IE forced her to pay ₦400,000 and transferred the remaining ₦800,000 to her prepaid meter.

“However, according to NERC regulations, electricity debts from previous occupants cannot be transferred to new customers. I took the case to NERC, and the commission ruled that IE’s actions were illegal. The judgment ordered IE to refund the ₦400,000 and remove the ₦800,000 debt from the woman’s meter,” he said.

He said, despite this ruling, IE has failed to comply.

“They were supposed to submit a compliance report within one month, but several months have passed, and the woman has still not received her refund or had the debt removed from her account.

“These ongoing violations highlight the need for stronger enforcement of NERC’s regulations and greater public awareness about consumer rights in the electricity sector,” he said.

Meanwhile, in a directive judgment issued by NERC to IE, obtained by SaharaReporters, following a complaint from Mr Oluyemi Sokunbi, the Commission ruled that, pursuant to Section 115(4) of the Electricity Act, a distribution company is prohibited from transferring unpaid electricity bills incurred by a previous landlord or tenant to new occupants.

The statement read, “The complainant was required by IKEDC (IE) to settle outstanding debt of N1,200,000.00 on meter Nos:0101027882 & 0100725785 of the newly acquired property No:30 Awolowo Street Oworonshoki before electricity supply is reconnected.

“He argued that the last occupant who used the electricity at that time remains liable for the debt and considered it unfair and contrary to section 29(3) of the CPR 2023 to put the burden on him to pay for what he did not know about.

“Consequently, he claimed that he should be refunded the N400,000.00 he paid to the respondent because he did not consume the energy at the moment.

“Complainant’s prayers: He prays for NERC to resolve in his favour that IKEDC shall recover the debt from the previous occupant in line with section 29(3) of the CPR 2023.

“That he should be refunded the N400,000.00 he paid to IKEDC because he is not the one who uses electricity services during that period.

“As contained in the Facts before the Ikeja Forum. Nil. Based on the findings from all submissions and evidence presentation (Where applicable), the Commission directs as follows:

“Pursuant to Section 115(4) of the Electricity Act, which prohibits a distribution company from transferring unpaid electricity bills incurred by a previous landlord or tenant to new occupants, it is hereby ordered as follows:

“The complainant shall not be held liable for any outstanding electricity bills incurred by the previous customer(s) associated with the property. 2. All such charges shall be expunged from the complainant’s account forthwith.

“IE is required to refund the complainant the sum of four hundred thousand naira only (NGN400,000) in form of energy credit.”

“IE is required to provide evidence of compliance to the forum office within One (1) billing circle,” the statement said.

– Sahara Reporters

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