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Tag: Discos

  • New Year: Discos set to increase electricity tariff nationwide Jan 1

    New Year: Discos set to increase electricity tariff nationwide Jan 1

    Disco, Nigeria’s electricity distribution companies, have reportedly concluded plans to hike electricity tariff nationwide with effect from January 1, 2024.

    A source in one of the DisCos confirmed the development to Newsmen under anonymity.

    Meanwhile , when contacted the Nigerian Electricity Regulatory Commission, NERC, Abuja Electricity Company didn’t respond to questions sent to them on the planned electricity tariff hike as of Sunday morning.

    However, Kunle Olubiyo, the President of the Nigerian Consumer Protection Network, said any planned electricity tariff hike will be outright irresponsible on the part of the Government.

    Continuing, he said  Nigerians are still grappling with the effects of fuel subsidy removal, rising inflation and other economic reforms by Tinubu’s administration.

    “Increasing electricity at this time, coupled with the impact of fuel subsidy removal, inflation, and other hardships facing Nigerians, will be insensitive on the part of the government.

    “It is outright irresponsible for the government to allow an electricity tariff hike,” he said.

    Recall that in November 2023, President Bola Ahmed Tinubu stopped the implementation of electricity tariff, insisting on a power sector subsidy.

    Speaking on Tinubu’s directive on electricity tariff hike, Minister of Power, Adebayo Adelabu, said  “The power sector is an industry that is very sensitive to any leader.

    “You cannot jump overnight and implement the cost-reflective tariff. I can tell you that till today, the government still subsidises power”.

    NERC’s quarterly reports indicated that electricity subsidies gulped N204.59 billion in the third quarter of 2023 and N135.23 billion in Q2, which is substantially higher than the N36.02 billion in Q1 2023.

  • Reps summon CBN, DISCOs, contractors over $321m loans for electricity projects

    Reps summon CBN, DISCOs, contractors over $321m loans for electricity projects

    The House of Representatives Public Accounts Committee has summoned the Central Bank of Nigeria (CBN) and 11 Electricity Distribution Companies (DISCOs) in connection with alleged mismanagement of the US$321 million and N18.2 billion loans.

    The loans were designated for accelerated transmission and distribution interface, lines, and substation projects.

    Rep. Bamidele Salam, Chairman of the Committee, issued the summons during the appearance of Engr. Sule Abdulaziz, Managing Director, Transmission Company of Nigeria (TCN), before the committee in Abuja on Thursday.

    These entities were asked to appear before the committee on November 8.

    The investigation was prompted by a petition regarding the alleged misuse of funds, which had been disbursed to the DISCOs by the CBN at the request of the TCN.

    Salam demanded detailed information regarding the loan disbursements, procurement processes, the involvement of DISCOs in the projects, the current status of the projects, and the loan repayment structure from the beneficiaries.

    Salam emphasised the importance of ensuring that public institutions adhere to the law and international best practices while ensuring the judicious utilization of funds.

    Appearing before the Committee, Abdulaziz clarified that the funds were transferred directly to the DISCOs by the CBN for the execution of various projects, with the intention of repaying the loans using TCN’s revenue.

    However, this repayment arrangement has raised concerns within the committee.

    He explained that there was a gap in the electricity sector, leading to complaints from distribution companies regarding the inadequate supply from TCN.

    He said, consequently, the need arose to invest in critical projects to enhance the distribution of electricity to Nigerians.

    According yo him, the Financial institutions and regulatory bodies, such as CBN and NERC, were involved in the financing and oversight of these projects.

    He said the TCN played a beneficiary role, while the DISCOs were responsible for executing the projects.

    He added that loan repayments were intended to come from TCN’s revenue, amortized on a monthly basis.

  • Tariff increase: Discos request for rate review – FG

    Tariff increase: Discos request for rate review – FG

    Eleven successor electricity companies have applied for a review of their respective electricity tariffs, the Federal Government has disclosed.

    Disclosing this through a notice published by the Nigeria Electricity Regulatory Commission (NERC) on Friday, the Federal Government said the request for rate review is premised on the need to incorporate changes in macroeconomic parameters and other factors affecting the quality of service, operations and sustainability of the companies.

    In the notice, NERC stated that Discos request for rate review is in pursuant to Section 116 (1) and 2 (a&b) of the Electricity Act 2023 and other extant rules.

    A recent attempt by some electricity distribution companies to hike tariffs from July 1 had caused uproar and met strong resistance from Nigerians.

    The Nigerian Labour Congress (NLC) had asked the government to shelve plans aimed at increasing electricity tariffs in the country, saying it was insensitive and callous to effect hike in power tariffs when consumers are still grappling with the hardship caused by the removal of the petrol subsidy.

    It appeared the public outcry worked as it was observed that the Discos shelved the planned tariff increase on July 1.

    However, the increase may still happen with the Thursday notice by NERC that the Discos have now applied for rate review.

    The regulatory body also stated that it will conduct a Rate Case Hearing on the applications prior to making a ruling as part of the rule-making process and in the exercise of the powers conferred by the Electricity Act.

    Access reaching further
    “Accordingly, the Commission hereby invites the general public for comments on the rate review applications by the distribution licensees. Interested stakeholders are advised to review and take into consideration the excerpts of the Rate Review Applications filed with the Commission by the respective licensees,” NERC stated.

    The Commission called on all members of the public and stakeholders to send their comments or representations before the close of business on 20th July 2023.

    The NERC tariff review process was designed with the intent of undertaking major reviews every five years.

    Additionally, an extraordinary tariff review is triggered when a Disco requires additional investment beyond the permitted capital expenditure, or when unforeseen operational, legal, or regulatory costs need to be reasonably passed on to consumers.

    Minor reviews are also scheduled every six months to adjust tariffs based on changes in gas prices, foreign exchange rates, generation output, and inflation.

    In the rate review application of one of the Discos, Ikeja Electricity Distribution Company, it stated that the tariffs are consistently falling below cost-reflective levels because the parameters are not aligned with the current reality of the business putting pressure on Discos and government to subsidize the tariff gaps.

    This, it added, undermines the Discos’ ability to fulfill their obligations under the Performance Agreements and Vesting Contract and exacerbates the liquidity challenges in the electricity sector.

    Also, Abuja Electricity Distribution Company, said it requests that the Commission take into account the amended end-user rate since it represents business realities for continuity and sustainability.

  • NERC orders DISCOs to stop billing disconnected customers

    NERC orders DISCOs to stop billing disconnected customers

    The Nigerian Electricity Regulatory Commission (NERC) has put a stop to a sharp practice by electricity distribution companies (DISCOs) in the country.

    Hitherto, DISCOs in the country have engaged in the practice of billing customers disconnected from electricity supply due to non-payment.

    The practice has resulted in protests and litigations among customers and the electricity distributors.

    However, NERC has ordered the DISCOs to stop billing any customer already disconnected for non-payment.

    The Commission, in an order signed by its chairman, Engr. Sanusi Garba insisted the extortion must stop.

    Garba, in the document titled: “Customer Protection Regulation 2023,” stated that DISCOs shall not bill customers until they are reconnected.

    “Whenever a supply address has been disconnected for non-payment and a bill has been produced representing consumption at the time of disconnection, the Distribution Company shall not bill for any additional charges in respect of that supply address until after it has reconnected electricity supply to the address,” he stated.

    NERC, however, disclosed that DISCOs may under special circumstances bill a customer a supplementary bill during the billing period.

    The document revealed that the special circumstances referred to could be when there is any need to amend an earlier bill where a customer made a request for correction.

  • We’re committed to overcoming electricity transmission challenges – TCN

    We’re committed to overcoming electricity transmission challenges – TCN

    The Governing Board of Transmission Company of Nigeria (TCN) on Tuesday said the company was more prepared to meeting the challenges of electricity transmission in the country.

    Mr Ekere Nsima, the Chairman, Technical and Monitoring Committee of TCN, said this in Lagos, in continuation of visits to transmission substations in Lagos by members of the Board of the company.

    “We are developing our capacity so that we can respond timelessly and efficiently to issues of maintenance.

    “TCN is improving its transmission capacity, and its ability to maintain in a professional manner, its facilities and equipment in our store in Lagos.

    “Consequently, there is an urgent need for the Generation Companies (GENCOs) and the Distribution Companies (DISCOs) to make the necessary investments to enhance their facilities to meet the challenges of the future,” he said.

    Nsima, who is a member of the Governing Board, commended President Muhammadu Buhari for providing fund for transmission to increase its capacity.

    “We have seen many transmission substations, both the ones already built, and the ones recently constructed.

    “We have also seen that efforts being made to improve capacity, we have a 300 MVA 330/132/33 Kv Transformer in Lekki Sub-Station, we also have 2x60MVA 132/33kV Transformer and we are planning on doubling it.

    “So, at the end of the day, we are trying to provide a very low cost transmission rate for Nigerians. I’m very optimistic and excited about the TCN of the future.

    “What we are doing now is building the TCN for the future. And I’m very optimistic that we will be able to meet the challenges of transmission of electricity in this country,” he said.

    The chairman said the company had the capacity to wheel out over 10,000megawatt of electricity, adding that the generation level presently was around 3,300MW.

    On their visit to Eko Atlantic City in Victoria Island, Nsima said TCN was

    planning to build a 120 MVA transmission substation for transmission of electricity to the city.

    “Eko Atlantic is building a modern city, so, TCN is partnering with them to provide a reliable power for the inhabitants.

    “And so we are building a transmission substation there, the contract has already been awarded,” he said.

    The News Agency of Nigeria reports that the members of Governing Board visited Lekki Substation and Eko Atlantic City to inspect generating plants project about to be completed.

  • FG takes over four DISCOs, constitutes NELMCO Board

    FG takes over four DISCOs, constitutes NELMCO Board

    The Federal Government has completed the takeover of four electricity distribution companies (DISCOs).

    The Vice President, Prof Yemi Osinbajo, stated this in a press statement on Friday.

    The statement noted that government has also constituted the Board of the Nigeria Electricity Liability Management Company (NELMCO).

    “The newly board would enhance ongoing efforts to resolve the liabilities relating to tariff shortfalls for power distribution companies nationwide.”

    The statement, which was signed by the Senior Special Assistant on Media and Publicity to the Vice President, Laolu Akande, noted that Osinbajo made the comment in a remark delivered virtually at the inauguration of the new 10-member board of NELMCO.

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    The statement was titled ‘FG moves to resolve tariff shortfalls in power sector as Osinbajo inaugurates Nigeria electricity liability management company’s board.’

    The Vice President also mandated the board composed of Ministers of Finance, Power, and others to protect the interests of the society, particularly ordinary citizens.

    Before Friday’s inauguration, NELMCO had been running without a duly constituted board since the first board was inaugurated in 2013 and dissolved shortly after.

    According to the Vice President, “Today’s inauguration marks an important milestone in the bid to resolve the liabilities relating to tariff shortfalls in the power sector (specifically for Distribution Companies), and to provide a veritable mechanism for managing the very dynamic nature of the liquidity challenges of the power sector in Nigeria.

    “This ceremony formally brings on board the invaluable skills and experience of notable and highly respected personalities as members of the Board of NELMCO.”

  • We’ll ensure changes in DisCos don’t disrupt service – FG

    We’ll ensure changes in DisCos don’t disrupt service – FG

    The Minister of Power, Mr Abubakar Aliyu says the ministry will ensure that the changes in corporate governance do not impact on the service and stability of the  Distribution Companies (DisCos).

    Mal Isa’ Sanusi, Special Adviser  on Media to the Minister of Power,  made this known in a statement in Abuja on Wednesday.

    Sanusi said that the minister had reassured electricity consumers that the recent changes in the governance of the DisCos would not adversely impact on the ongoing reform initiatives including the National Mass Metering Programme.

    He  said that the minister had been briefed by the Nigerian Electricity Regulatory Commission (NERC) and Bureau of Public Enterprise(BPE)
    on the recent events relating to
    corporate governance in Kano, Benin, Kaduna, lbadan and Port Harcourt   DisCos.

    Sanusi said that the event had necessitated a change in the respective Board of Directors and Management of the DisCos.

    According to him, the changes announced was as a result of the receivership of the core investors in Kano, Benin, Kaduna and lbadan DisCos.

    ”Whereas the actions in Port Harcourt DisCo are sought to provide much needed liquidity and prevent the insolvency and risk of collapse of the utility in implementing the changes.

    Sanusi affirmed  that while the  Government continue to hold a 40 per cent equity stake in all the DisCos.

    “The utilities are still private sector led “going concerns” falling under the
    provisions of the COMPANIES AND ALLIED MATTERS ACT (CAMA) and subject to regulation by the Nigerian Electricity Regulatory Commission (NERC).

    ”The ministry had received a confirmation from the Bureau of Public Enterprise (BPE) and the Central Bank of Nigeria that in exercising the rights of lenders to the core investors.

    ”The financial institutions do not retain the ownership of the shares and management of the DisCos in perpetuity.

    ‘It is therefore expected that clear timelines for exit of the banks would be prescribed by the regulators as and when appropriate,” he said.

    Recall that Fidelity Bank said it planned to take over the boards of Kano, Benin and Kaduna Distribution Companies (DISCOs) and to collateralize their shares.

    The Director-General of  BPE, Alex Okoh, and the Executive Chairman, Nigerian Electricity Regulatory Commission (NERC), Sanusi Garba said this in a joint statement on Wednesday in Abuja.

    “Today, we were informed by Fidelity Bank that they have activated the call on the collateralised shares of Kano, Benin and Kaduna (Fidelity and AFREXIM) DISCOs.

    “They have also initiated action to take over the Boards of these DISCOs and exercise the rights on the shares.

  • FG tells DISCOs to refund Nigerians who bought electricity meters

    FG tells DISCOs to refund Nigerians who bought electricity meters

    The Federal Competition and Consumer Protection Commission (FCCPC) has said Electricity Distribution Companies (DISCOs) should make refunds to consumers who purchased meters.

    Discos have been overwhelmed by meter demand from non-metered consumers, hence, houses taking the bull by the horn to purchase the meters without waiting for provision from the Discos.

    As of September 2021, there were over 8.01 million unmetered customers out of 12.78 million registered energy customer population, according to the Nigerian Electricity Regulatory Commission (NERC), which means only 37.3% of the population are metered.

    Addressing consumers taking up the responsibility of metering their houses, FCCPC, via a Twitter post on Sunday, said, “Customers can purchase meters using the MAP Framework.

    “However, DISCOs are responsible for refunding or compensating customers who paid in advance for the meters. The cost of the meter is to be reimbursed in 36 equal monthly payments using consumer-purchased energy credits.” it wrote.

    The government agency further stated that consumers shouldn’t take up the responsibility of providing transformers, poles or other electricity equipment, neither should they repair faulty transformers.

    “Electricity Consumer Right/Responsibility: It is not the responsibility of the customer or the community to purchase, replace or repair transformers, poles or other associated equipment used in the distribution of electricity”.

    Although the commission suggested that consumers and Discos can enter into agreement, which would temporarily pass the responsibility of providing transformer and other Electricity equipments on the users.

    “Faulty transformers are supposed to be replaced by the Electricity Distribution Company (DisCo) within forty-eight hours of the official complaint being made. The Electricity Distribution Company (DisCo) is responsible for such replacements or repairs.

    “However, if the Electricity Distribution Company (DisCo) is unable to speedily replace the faulty transformer, residents may go into discussions with the company and agree on the terms of the replacement of the affected transformer if they so wish to assume the responsibility of the company.” FCCPC stated.

  • FG again warns DISCOS to stop selling meters

    FG again warns DISCOS to stop selling meters

    The Federal Government on Thursday in Abuja cautioned Distribution Companies (DISCOS) again against selling electricity meters to customers, saying procurement of meters is free of charge.

    Minister of Power, Alhaji Abubakar Aliyu, gave the warning during the weekly State House ministerial briefing organised by the Presidential Media Team.

    The minister blamed those he described as `touts’ and “kabu-kabu’’ people in the power sector as responsible for the reported selling of meters to electricity customers.

    “You will always have these kinds of things – like somebody trying to short-change others; otherwise these meters are free; we said it a number of times.

    “These are tools that will generate liquidity. How can we be selling something that will bring in money?

    “It is the responsibility of the DISCOS and the government is seeing that they are not doing so.

    “So, government is stepping in and giving the DISCOS the meters to distribute for free.

    “But there’ll always be `touts’ and `kabu-kabu’ and I think it’s the touts that are doing this kind of shoddy deal,’’ he said.

    According to the minister, accelerated procurement of four million meters for the second phase of the Federal Government’s mass metering programme is on-going, with critical focus on local manufacturers.

    “Currently, close to one million meters have been rolled out under the first phase and accelerated procurement is on-going for the second phase of four million meters with critical focus on local manufacturers.

    “This is aimed at providing jobs through the programme.

    “The first phase generated 10,000 jobs in installation and assembly. We anticipate that the second phase contract will be awarded by the end of the second quarter of this year.

    “There will be a third phase that will provide additional two million meters, funded through the World Bank,” he added.

    The minister also warned that actions would be taken against underperforming DISCOs under the guidelines of the contractual agreements as the Federal Government had improved regulatory certainty.

    On erratic power supply currently being experienced in Abuja and other parts of the country, the minister said the problem was caused by low water level in the hydro power stations.

    “With the reduction in water levels at the hydro power stations during the dry season, the need for additional load to be taken up by gas plants and the challenges in repairs currently being done on generators are responsible for the load shedding and power outages,’’ he said.

    According to him, government is doing everything to ensure optimum supply of gas to ensure quick restoration of power.

    The minister, who spoke on various power initiatives by the ministry, including the Presidential Power Initiative being driven by Siemens, maintained that the issue of right of way was stalling power projects.

    “We are engaging with state governors through the Nigerian Governors Forum to drive a holistic solution to these lingering issues.

    “Critical projects held up by right of way are the Benin to Osogbo 330 KV line which is 250 kilometres long and the Ikot Ekpene to Ikot Abasi also 330 KV line, which is 68 kilometres long.

    “Another is the Kano-Katsina 330 KV line, also 180 kilometres long,’’ he said.

    According to Aliyu, the attention the power sector is receiving under the Buhari administration is unprecedented.

    “Since the inception of the present government, it has turned its attention to our infrastructure and the attention this government is giving in my own view, is unprecedented.

    “The enormity of the decay in the sector is what we are battling with to ensure we overcome challenges associated with electricity delivery in the country,’’ he stressed.

  • NERC orders DisCos to suspend electricity tariff hike

    NERC orders DisCos to suspend electricity tariff hike

    The Nigerian Electricity Regulatory Commission (NERC) has ordered the 11 Electricity Distribution Companies (DISCOs) to suspend the Sept. 1 tariff increase for 14 days.

    The suspension is in line with the agreement reached with the organised Labour on the suspension of strike over the hike in electricity tariff and increase in pump price of petrol.

    The commission’s suspension order of the Multi-Year Tariff Order (MYTO) 2020 signed by Prof James Momoh, NERC’s Chairman was released on its website on Wednesday.

    The Federal Government agreed that the recent review in electricity tariffs would be suspended by the commission for a period of 14 days to further consultations and finalization of negotiations between the parties.

    The order by NERC said that from Sept 28 to Oct 11 the DisCos must revert all charges to the tariff existing as of Aug 31.

    “This means that for the next two weeks, electricity consumers having power above 12 hours who were affected by the over 100 percent tariff hike would revert to their old charges.

    It said as empowered by Section 33 of the Electric Power Sector Reform Act, EPSRA 2005, the Minister of Power, Sale Mamman can issue such directive to NERC.

    The Secretary to the Government of the Federation, Boss Mustapha, and Mamman were among the team that met with the labour unions.