Power Distribution Companies (Discos) in the country yesterday reacted to allegations that they forced the Nigerian Electricity Regulatory Commission (NERC) to suspend trading of electricity under the eligible customer regulation.
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The regulation empowers NERC to grant customers using more than two megawatts/hour approval to get their electricity directly from the Generation Companies (Gencos) rather than through the power distributors.
A statement by the Association of Nigerian Electricity Distributors (ANED) through its Executive Director, Research and Advocacy, Mr. Sunday Oduntan explained that the Discos recognise the relevant provisions of the electricity law, 2005 and therefore could not have prevailed on NERC to make the decision.
Rather the Discos argued that what NERC tried to do was to stop the alleged illegalities being embarked by certain elements within the system, noting that with more collaborations to increase efficiencies of the entire value chain, there had been an improvement in the supply of uninterrupted power supply to Nigerians.
“The regulation is therefore a welcome initiative provided that the stakeholders comply with the laid down procedures and requirements. In response to the insinuation that NERC and the Discos are colluding to frustrate the implementation of the regulation, we wish to state unequivocally that this is untrue,” ANED stated.
The Discos added that stakeholders who have failed to meet the requirements of the regulation were attempting to pass the buck to the electricity distributors.
“In fact, to fault NERC (who have been unduly lenient with them) is undermining the powers of the commission as the regulator of the Nigerian power sector, vested with the requisite authority to ensure sanity in the Nigerian Electricity Market (NEM),” ANED added.
The Discos stressed that NERC confirmed in their letter to the Transmission Company of Nigeria (TCN) on the suspension of the bilateral electricity trade that such customers are yet to meet requirements that include requisite energy demand and proof of excess capacity by the Gencos to supply the energy.
In addition, the Discos listed the payment of requisite charges and fees to exit conventional network as well as getting eligible status from the regulator as some of the conditions required by the regulation.
According to the power distributors, the available records indicate that NERC has not approved any application for eligible customer status.
“Despite that, these companies proceeded to arrogate the powers of NERC to themselves by vesting in themselves eligible customer status and continued the unlawful and illegal operations over the years unperturbed.
“The illegal and unlawful operations of these companies and the Gencos involved are a direct cannibalisation of the electricity market and the entire value chain,” ANED said.
It added: “NERC, having duly noticed the damaging impact of these illegal eligible customers on the electricity market and the entire value chain, had to issue a directive with Ref. No: NERC/REG/OCFML/APPR/EC/2655/068, dated 7th July, 2021, to TCN to transfer back to the Discos all electricity customers that failed to obtain eligibility status under the regulation.”
ANED also clarified that NERC has not cancelled the regulation as claimed, saying that the directive was simply to stop the illegality that had been perpetrated by those they described as “unscrupulous companies and their supplier generation companies who have gone rogue for four years unchecked.”
