Discos, NBET, NERC, Regulation

More Problems for the DisCos as NERC Issues Intention to Cancel Licences of 8 DisCos

Posted: October 13, 2019 at 7:24 pm   /   by   /   comments (0)

The times are really not good for the electricity distribution companies, DisCos, in Nigeria. They have been receiving bashing from the Transmission Company of Nigeria for rejecting huge amount of electricity generated by the GenCos and transported to load centers.

Only a few months ago, the Electricity Market Operator descended on several DisCos for not topping their bank guarantees for service invoices and some for not paying 100% of the service invoices. The DisCos scrambled to be doing the needful and the Market seems cruising and suddenly the industry regulator, NERC dangles her hammer.

This time the NERC hammer is about to fall on 8 DisCos for not being able to meet their minimum remittances to NBET for the main supply of electricity the DisCos get particularly for July 2019 based on the revised MYTO tariffs recently approved for the DisCos.

All the DisCos except three- Eko, Jos and Ibadan- now have 60 days to show cause why their licences should not be revoked for this major breach of the extant ESPR Act of 2005 according to the NERC Resolution published in several national newspapers and on the regulator’s website and social media handles.

Some industry experts who spoke with Energy Business are of the feelings that the DisCos have two options; either to cure the defaults by making good the shortfall in payment and return to the good books of the regulator or they actually risk the loss of their licences since NERC seems ready to kick in the procedures to cancel the licences of defaulters.

The energy experts also feel that this new awakening and push for discipline and respect for signed agreements in the electricity industry is good for all players so that the market can on its own check impunity, indiscipline and corporate selfishness that has corrupted or bedeviled the market since inception.

Rather than pile undue pressure on already identified paying customers or blame the regulators, the DisCos were advised by the experts to go after distribution loss points to bring several people who are currently not in their billing streams. They should target zero loss in distributed energy that is not presently accounted for.

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