Abstract:
Unstable electricity supply has been a major hindrance to economic development in
Nigeria. Attainment of stable and reliable electricity supply requires three basic
dimensions: technicalities, organisational structures and reduction of Electricity Theft
(ET) to the barest minimum. Previous studies focussed more on the technical and
organisational requirements with little attention paid to ET and its resultant effects
particularly at household level. Therefore, this study was designed to examine the
determinants of ET, its prevalence and effects among households in Lagos State,
Nigeria.
Becker’s Economic Theory of Criminal Behaviour served as the framework, while a
survey design was adopted. A self-developed structured questionnaire focusing on
determinants, prevalence and effects of ET was randomly administered to 580
household’s (area of franchise under Ikeja Electric Plc. (n = 330), and Eko Electricity
Distribution Company (n= 250) electricity end-users in Lagos State. Bribery and
Corruption (BC), Income Level (IL), Lack of Punishment of Earlier Offenders
(LPEO), Running Micro-Business in Residential Apartments (RMBRA), Non Availability of Taskforce (NAT) to apprehend perpetrators, Frequency of Power
Outages (FPO), Electricity Tariff (ELT) and Weak Enforcement of Anti-Electricity
Theft laws (WEAET) were factors investigated as potential drivers of ET. Descriptive
statistics were used to analyse prevalence and effects of ET, while Probit Regression
estimation technique was used to identify its determinants among households at α0.05.
The key drivers of ET were BC (β=0.063), IL (β= 0.060), LPEO (β=0.020), RMBRA
(β=0.040), FPO (β=0.101), WEAET (β=0.104) and ELT (β=0.139). All the factors
were positive and statistically significant. An important driver of ET, IL (β= 0.060),
which was positive and statistically significant indicated that incidence of ET cuts
across all income groups in Lagos State. The prevalence of electricity theft was (in two
digits) 14.0% indicating excessive involvement of household electricity end-users in
ET. The major effects of electricity theft included damage to electric power equipment
(64.4%), difficulty in planning for service delivery (68.2%), increased expenses on
self-power generation (51.6%), damage to household appliances (61.4%), epileptic
electricity supply (72.4%), brown out (73.2%), poor revenue to the electricity
distribution companies (82.0%) and further reduction in the quantity of electricity
available for household use (72 .4%). The incidence of ET in Lagos State was
widespread, cut across all income groups and had varied significant harmful effects on
both the households’ electricity end-users and the electric power utilities.
Strong determinants of Electricity Theft among households in Lagos State, Nigeria,
were corruption, running micro business within residential apartments and weak
enforcement of anti-electricity theft laws with severe consequences on the entire
electric power value chain. Strengthening institutions for enforcement and application
of anti-electricity theft laws is recommended to mitigate the problem.
