Tag: Discos

  • No tariff increase for customers enjoying less than 12 hours electricity daily – NERC

    No tariff increase for customers enjoying less than 12 hours electricity daily – NERC

    The Nigerian Electricity Regulatory Commission (NERC) on Friday insisted that electricity Distribution Companies (DisCos) must not increase tariffs of customers enjoying less than 12 hours of power supply daily.
    Mr Dafe Akpeneye, NERC Commissioner, Legal Licensing and Compliance, made the clarification during the regulatory agency’s online town hall meeting with customers on the new electricity tariff regime.
    The News Agency of Nigeria (NAN) reports that the DisCos had on Sept. 1 announced the implementation of new Service Reflective Tariff Plan (SRT) across their franchise areas.
    The DisCos said the classes of customers had been categorised into five bands with bands D and E who were not enjoying 12 hours daily power supply not affected by the new tariff plan.
    However, Akpeneye, who was responding to claims by some customers that the DisCos were not adhering to the increment terms, maintained that those below 12 hours supply daily should not experience any increment.
    He explained that the hours and bands were decided by the commission after consultations but customers were assigned to the bands by the DisCos.
    Akpeneye said:”Anyone who is enjoying less than 12 hours of electricity must not have their tariffs increased.
    “Customers who receive electricity service below the band they have been assigned can have the DisCos move them to the actual band of electricity service they receive.
    “Unhappy? Contest the band classification you have been assigned.”
    He said in order to protect unmetered customers from exploitation by the DisCos, NERC came up with “Parity with Neighbours”.
    “This is the principle we are applying with unmetered customers. It basically means as an unmetered customer, you cannot be charged more than your metered neighbour,”the commissioner said.
    Akpeneye also disclosed that NERC had mandated all DisCos to invest in infrastructure in order to increase power supply to customers.
  • Light bill: Buhari addresses recent tariff adjustment by DisCos

    Light bill: Buhari addresses recent tariff adjustment by DisCos

    …says timing of new tariff, new PMS price coincidental

    President Muhammadu Buhari on Monday touched on the recent service based tariff adjustment by electricity distribution companies (DisCos) in the country.

    TheNewsGuru.com (TNG) reports Buhari as saying the recent service based tariff adjustment by the Discos was a source of concern.

    The President made these comments at the first year ministerial performance review retreat at the State House conference centre in Abuja.

    He said so far to keep the industry going, the nation had spent almost 1.7 trillion, especially by way of supplementing tariffs shortfalls, and that there was no more resources to continue in this way.

    Buhari said it would be grossly irresponsible to borrrow to subsidize a generation and distribution which are both privatized.

    “Let me say frankly that like many Nigerians I have been very unhappy about the quality of service given by the Discos, but there are many constraints including poor transmission capacity and distribution capacity.

    “I have already signed off on the first phase of the Siemens project to address many of these issues.

    “Because of the problems with the privatization exercise, government has had to keep supporting the largely privatized electricity industry.

    “So far to keep the industry going we have spent almost 1.7 trillion, especially by way of supplementing tariffs shortfalls.

    “We do not have the resources at this point to continue in this way and it will be grossly irresponsible to borrrow to subsidize a generation and distribution which are both privatized.

    “But we also have a duty to ensure that the large majority of those who cannot afford to pay cost reflective tariffs are protected from increases,” he said.

    The President said the Nigerian Electricity Regulatory Commission (NERC), the industry regulator therefore approved that tariff adjustments had to be made but only on the basis of guaranteed improvement in service.

    “Under this new arrangement, only customers who are guaranteed a minimum of 12 hours of power and above can have their tariffs adjusted.

    “Those who get less than 12 hours supply, or the Band D and E Customers MUST be maintained on lifeline tariffs, meaning that they will experience no increase. This is the largest group of customers,” Buhari explained.

    He went further to say that the government has also taken notice of the complaints about arbitrary estimated billing.

    “Accordingly, a mass metering program is being undertaken to provide meters for over 5 million Nigerians, largely driven by preferred procurement from local manufacturers – creating thousands of jobs in the process.

    “NERC has also committed to strictly enforcing the capping regulation which will ensure that unmetered customers are not charged beyond the metered customers in their neighbourhood. In other words no more estimated billings,” he said.

    Buhari also stated that the process of providing financing support through the CBN for manufacturers and retailers of off grid solar home systems and mini-grids who are to provide the systems had begun.

    He stressed that the five million systems under the ESP’s Solar Power Strategy will produce 250,000 jobs and impact up to 25 million beneficiaries through the installation.

    “In addressing the power problems we must not forget that most Nigerians are not even connected to electricity at all. So as part of the Economic Sustainability Plan, we are providing Solar home systems to 5 million Nigerian households in the next 12 months.

    “We have already begun the process of providing financing support through the CBN for manufacturers and retailers of Off Grid Solar Home Systems and Mini-Grids who are to provide the systems.

    “The Five million systems under the ESP’s Solar Power Strategy will produce 250,000 jobs and impact up to 25 million beneficiaries through the installation.

    “This means that more Nigerians will have access to electricity via a reliable and sustainable solar system.

    “The support to Solar Home System manufacturers and the bulk procurement of local meters will create over 300,000 local jobs while ensuring that we set Nigeria on a path to full electrification.

    “The tariff review is not about the increase, which will only affect the top electricity consumers, but establishing a system which will definitely lead to improved service for all at a fair and reasonable price.

    “There has been some concern expressed about the timing of these two necessary adjustments.

    “It is important to stress that this is coincidental in the sense that the deregulation of PMS prices happened quite some time ago, it was announced on 18 March 2020 and the price moderation that took place at the beginning of this month was just part of the on-going monthly adjustments to global crude oil prices.

    “Similarly, the review of service-based electricity tariffs was scheduled to start at the beginning of July but was put on hold to enable further studies and proper arrangements to be made.

    “This government is not insensitive to the current economic difficulties our people are going through and the very tough economic situation we face as a nation, and we certainly will not inflict hardship on our people.

    “But we are convinced that if we stay focused on our plans, a brighter andmore prosperous days will come soon. “Ministers and senior officials must accordingly ensure the vigorous and prompt implementation of the ESP & all of our programmes, which will give succour to Nigerians.

    “In this regard, the Central Bank of Nigeria (CBN) has created credit facilities (of up to N100B) for the Healthcare (N100 Billion) and Manufacturing (N1 Trillion) sectors.

    “From January, 2020 to date, over N191.87B has already been disbursed for 76 real sectors projects under the N1TRN Real Sector Scheme; while 34 Healthcare projects have been funded to the tune of N37.159B under the Healthcare Sector Intervention Facility.

    “The facilities are meant to address some of the infrastructural gap in the healthcare and manufacturing sector as a fall out to the COVID-19 pandemic and to facilitate the attainment of the Government’s 5-year strategic plan,” Buhari stated.

    He also stated that the “Implementation of a Willing Buyer, Willing Seller Policy for the power sector, has opened up opportunities for increased delivery of electricity to homes and industries.

    “We are also executing some critical projects through the Transmission Rehabilitation and Expansion Programme, which will result in the transmission and distribution of a total of 11,000 Megawatts by 2023”.

  • COVID-19: DISCOs pledge two-month free electricity for Nigerians

    COVID-19: DISCOs pledge two-month free electricity for Nigerians

    The Electricity Distribution Companies (DisCos) have given assurance of their support for the plan to supply free electricity to all consumers.

    It is one of the palliative measures being considered by the National Assembly to bring succour to Nigerians in the face of COVID-19 induced economic paralysis.

    Mr Sunday Oduntan, Executive Director, Research and Advocacy Association of Nigerian Electricity Distributors (ANED), confirmed the DISCOs support for the move on Wednesday in Abuja.

    Recall that the House of Representatives is already considering a Stimulus Bill that will allow Nigerians to enjoy free electricity supply for two months.

    “We are completely aligned with the plans to ensure palliative measures, including free electricity supply to all Nigerians for two months, to make life easier, during the lockdown period”, Oduntan said.

    “We recognise the challenging effects of the Coronavirus (COVID-19) on the economic and daily lives of our customers.

    “In fulfilment of our commitments to the nation, we hereby align ourselves with the efforts of the National Assembly and the Federal Executive Council to mitigate the hardships that are currently faced by our customers and other citizens all over the country,” he said in a statement.

    Oduntan said that DisCos also commended the Federal Legislators, the Executive arm and the Nigerian Electricity Regulatory Commission (NERC) for the initiative.

    He said that the DisCos were committed to working with them to ensure more efficient power supply within this difficult period, as the nation battles with the ravages of COVID-19.

    “Again, as a key utility player in the Nigerian Electricity Supply Industry (NESI), we hereby reiterate our commitment to improving service delivery to the nation during this pandemic period and thereafter,” Oduntan said.

  • Inefficient DISCOS crave for tariff hikes, By Ehichioya Ezomon

    Inefficient DISCOS crave for tariff hikes, By Ehichioya Ezomon

    By Ehichioya Ezomon
    From a 78 per cent January 2020 upward review – reportedly heavily subsidised by the government – Nigerians will bear further burden of a 35 per cent hike in electricity tariffs from next month. The increase will lift the current N24 per kilowatt of electricity to N32.
    This is a fallout from the sustained campaign by the Distribution Companies (DISCOS), which have pinned expected satisfactory performance of supplying consumers on the increase in tariffs.
    Over-the-moon by the vista of hope from the Nigerian Electricity Regulatory Commission (NERC), the DISCOS, going by media reports, have begun “awareness crusade to brace consumers.”
    Almost from the onset of their taking over, officials have moaned that about 60 per cent of the energy distributed “failed to match revenue projections.”
    They also complained that the “grossly inadequate” $150 million made available for procurement couldn’t mitigate their inability to raise funds from commercial banks “to import enough meters.”
    So, they linked abolishing the notorious ploy of estimated billings to their being awash with funds to procure meters – partially available locally, but which the DISCOS have failed to avail themselves or encourage their mass production.
    Now that they have their way at the detriment of consumers, who’ve been at the receiving end of the seesaw between the government and DISCOS, Nigerians hope for a turnaround in supply of power and estimated billings – to relive the nostalgia of the Electricity Corporation of Nigeria (ECN) established in 1950.
    We grew up in the ’60s hearing about the efficiency of the ECN. Yes, we heard because prior, we hadn’t seen any light produced from the conversion of primary sources of energy, such as coal, natural gas, nuclear, solar, and wind into electrical power.
    Later, we heard that supply of power had changed hands – from ECN to the National Electric Power Authority (NEPA) in 1972. Still, many of us were non-practical, as we had only a faint idea about how electricity worked, without experiencing it!
    Then, in mid ’70s came the Rural Electrification Agency (REA), with the mandate to electrify rural and unserved communities. And about 1978, electrify reached our village – Idumabi, Irrua, in present-day Esan Central Local Government Area of Edo State.
    It’s an unimaginable novelty: With the flip of a switch, light would appear in a bulb, and energy transmitted to power radio and television sets, pressing irons and so on!
    Though the power wasn’t of 24-hour supply, its rationing was constant and consistent, and consumers knew when their areas would get supply, and how many hours or days it would last. And the beauty of it: Supply was virtually free, with tokens paid for connection, and monthly tariffs.
    But this piece of good news didn’t last, as NEPA, by it’s skewed regulations, compelled the REA to be linked to the national grid, to enable it control, not necessarily its operations, but finances.
    That’s how high tariffs, estimated billings and corruption came into the system. Consumers, who couldn’t pay the bills or fail to “grease the palm” of NEPA crew, were indiscriminately disconnected.
    NEPA also brought inefficiency into the system, with the authority earning unsavouring appellations to the bargain: “No Electric Power at All,” “Never Expect Power at All” or “Never Expect Power Again.”
    The most hilarious part? Whenever power was cut, people would chorus, “Oh, NEPAaaaaa!” And if power was restored, the refrain would be, “Up NEPAaaaaa!”
    Such expression of frustration and exhilaration continues till date even as NEPA became Power Holding Company of Nigeria (PHCN) – what a metaphor! – and then unbundled into Transmission Company of Nigeria (TCN), Generation Companies (GENCOS) and DISCOS.
    What’s change in a name without change in inefficiency, work ethics, blackmail, extortion and short-changing of consumers! It’s a case of “Old wine in a new bottle,” “The leopard cannot change its spots,” and “The hood does not make the Monk.”
    The DISCOS – the direct links between electricity supply and consumption, and the ones to hold to account for failure – have put profit before and above service to consumers. They’re hyper-focused on tariff hikes, on the excuse of insufficient funds to upgrade the systems for efficient services.
    For instance, the DISCO covering my vicinity in Lagos – Ikeja Electric (abbreviated “ie”) – presents the inefficient operations that run the gamut of DISCOS in the country.
    Let’s take a sample of messages of “apology” that the company regularly sends to customers, to explain disruption in services. This is indicative of inefficiency, due to reliance on obsolete equipment, and the staff members – with all their foibles – it inherited from the defunct PHCN/NEPA.
    Date: Saturday, 8 February 2020. Time: 11:13
    “Dear Customer, The current supply interruption is as a result of fault on Igando 33KV Feeder in your vicinity. Our Engineers are currently working to resolve this. Please be assured that supply will be restored as soon as the maintenance is completed. Thank you for allowing us to serve you.”
    Date: Sunday, 9 February 2020. Time: 14:06
    “Dear Customer, Please be informed that the 132KV feeding Ejigbo Transmission Station tripped, making the entire Transmission Station (to be) out of supply. TCN crew are to patrol and restore the line. Please be assured that supply will be restored as soon as the maintenance is completed. Thank you for allowing us to serve you.”
    Date: Monday, 10 February 2020. Time: 23:58
    “Dear Customer, The current supply interruption is as a result of fault on the Distribution Transformer supplying your vicinity. Our Engineers are currently working to resolve this. Please be assured that supply will be restored as soon as the maintenance is completed. Thank you for allowing us to serve you.”
    Note the different, but flimsy excuses that the Ikeja Electric gave for the series of supply interruption – some happening on consecutive days, and lasting for days or weeks.
    For example, on Saturday, February 8, it had a fault on the Igando 33KV Feeder. The next day, Sunday, February 9, the 132KV feeding Ejigbo Transmission Station tripped, “cutting supply to the entire Transmission Station.” And on Monday, February 10, it resulted from a fault on the Distribution Transformer.
    As usual, the company would promise to restore supply soon after its Engineers had completed the “routine” maintenance – a promise often displaced by a subsequent supply disruption – and thank the distrust consumers for “allowing us to serve you.” Imagine!
    Meanwhile, in between these disruptions – and lingering darkness – the Ikeja Electric continued to send mostly estimated bills to consumers for services it didn’t render.
    Will the new increase in tariffs take Nigerians out of the woods of little or no power at all? That would be a 21st Century miracle!
    * Mr. Ezomon, Journalist and Media Consultant, writes from Lagos, Nigeria.
  • DisCos lack capacity to meet Nigeria’s electricity demands – TCN

    Power Distribution Companies (DisCos) lack the capacity to meet the nation’s electricity needs, Transmission Company of Nigeria (TCN) Managing Director Usman Mohammed has said.

    Mohammed, who spoke in Lagos on Monday, said the privatisation process produced weak Discos.

    “Some mistakes were made in the privatisation of the power sector and the mistakes led to very weak companies that succeeded in taking over the DisCos. The law was adjusted to allow bidding companies use technical partners and the partners were not to produce the Managing Directors. This made it easy for companies without capacity to buy the DiScos. The weakness must be corrected by recapitalising the DisCos because when we did the privatisation, we didn’t have the investments commensurate with the distribution network,” he said.

    The TCN boss, however, cautioned against re-purchase of the privatised companies by the government because it would send a wrong signal to foreign investors. Instead, he said, the DisCos must be recapitalised to enhance their capacity. Mohammed expressed regret that the Federal Government has spent N1.5 trillion on the DisCos with little or nothing to show for it.

    The TCN has estimated a DisCo capital requirement of $4.3billion to address capacity shortfalls and enable load growth to keep pace with capacity growth, he explained.

    Mohammed listed other conditions for the DisCos to be able to live up to their responsibilities to include the commencement of bilateral trade, competitive procurement as required by National Electricity Regulatory Commission (NERC) Investment Regulation 2015, competitive procurement of generation companies, resetting the books of the Discos, proportionate representation on Board of DisCos by the Ministry of Finance and sustenance of Transmission Rehabilitation and Expansion Programme (TREP).

    According to him, the United Nations Sustainable Development Goals classified access to electricity as a standalone goal number 7 because it stands out as the most important infrastructure. He explained that countries with good Gross Domestic Product (GDP) per capita have uninterrupted electricity supply.

    Mohammed added that the crisis of the Nigeria electricity market was traceable to poor liquidity, lack of sustainable investment, weak national grid with system instability, emergency solution and poor planning. He also faulted the use of single buyer model, explaining that it had never worked anywhere it was adopted.

    He said his administration had recovered 795 of 810 containers containing TCN apparatuses abandoned by contractors at the port. Some, he said, were abandoned for over 15 years.

    Mohammed said with countries like Benin Republic, Chad, Niger, Cameroon, which get their source of power from Nigeria, with uninterrupted supply, the country has no excuse.

    Mohammed said when President Muhammadu Buhari administration came into power, the value chains in the power sector had problems ranging from generation to transmission and distribution.

    “The generation was around 3,500 megawatts just as distribution and transmission capacity was not more than 5,000 megawatts. But, as of December 2018, transmission capacity reached around 8,100 megawatts, which means that there is a significant improvement.

    “Now, the generation capacity is about 7,500 megawatts, which also means significant improvement. So, if you had three things that were not working and you have fixed two, a significant improvement has taken place.

    “With the government’s N72 billion distribution programme being implemented by the Ministry of Power and other interventions, I believe the government is willing to resolve the last line and soon, we will see better results,” Mohammed said.

  • FG orders increase in electricity tariffs

    ELECTRICITY tariff is going up across the country, and this is official. The 11 electricity distribution companies (DisCos) have the mandate of the Nigerian Electricity Regulatory Commission (NERC) to effect the tariff increase from April.

    These are: Abuja Electricity Distribution Company, Benin Electricity Distribution Company, Enugu Electricity Distribution Company, Eko Electricity Distribution Company, Ibadan Electricity Distribution Company, Ikeja Electricity Distribution Company, Jos Electricity Distribution Company, Kaduna Electricity Distribution Company, Kano Electricity Distribution Company, Port Harcourt Electricity Distribution Company and Yola Electricity Distribution Company.

    Consequent upon the NERC directive, Abuja Electricity Distribution Company (AEDC) residential customers R3 will now pay N47.09 per unit as against the current N27.20, while Ikeja Electricity Distribution Company (IKEDC) customers in R3 category will pay N36.92 per unit instead of N26.50. Commercial customers C3 category will start paying N38.14 per unit instead of N24.63 and industrial customers of the IKEDC D3 category who are currently paying N25.82 per unit will henceforth pay N35.85 per unit.

    Enugu Electricity Distribution Company residential (R3) customers who currently pay N27.11 per unit will start paying N48.12 per unit. NERC said the order was pursuant to Section 32 and 76 of the Electric Power Sector Reform Act aimed at providing a cost reflective tariffs that ensures prices charged by licensees are fair to consumers.

    The commission also directed the DisCos to complete settlement of market invoices. “All DisCos are obligated to settle their market invoices in full as adjusted and netted off by the applicable tariff shortfall,” NERC said, adding: “In the determination for compliance to the minimum remittance threshold in this Order, the commission shall consider verified receivables from MDAs for the settlement period and DisCos’ historical collection efficiency for MDAs.

    “The commission shall hold the TCN responsible for deviation from the economic dispatch Order that adversely impact on the base weighed average cost of the wholesale of energy.” NERC last approved an upward review of tariff in July. The commission said the tariff adjustment was based on the relevant data it obtained from the Central Bank of Nigeria (CBN) and National Bureau of Statistics (NBS) such as average monthly inflation rate of 11.3 per cent, exchange rate of N309.97.

    It also added that it obtained its data on inflation rate from the US rate of inflation, which projected 1.8 percent for the period of January to October 2019. It said that all DisCos are “obligated to settle their market invoices in full as adjusted and netted off by the applicable tariff shortfall.” It added:”in the determination for compliance to the minimum remittance threshold in this Order, the commission shall consider verified receivables from MDAs for the settlement period and DisCos’ historical collection efficiency for MDAs.

    “The commission shall hold the TCN responsible for deviation from the economic dispatch Order that adversely impact on the base weighed average cost of the wholesale of energy. All FGN intervention from the financing plan of the PSRP for funding tariff shortfall shall be applied through NBET and the MO to ensure 100 percent settlement of invoices issued by market participants.

    Under this framework, the minimum market remittance by AEDC is determined after deducting the revenue deficient arising from tariff shortfall from the aggregate NBET and MO market invoices. AEDC shall be availed the opportunity to earn its revenue requirement only upon fully meeting the following obligations and subject to efficient operations.”

    The increase in tariff is coming at a time the majority of Nigerians are displeased with the poor and epileptic supply from the Discos. The national grid collapses at will, disrupting socio-economic activities.

    Many households cannot afford to store food items in freezers while commercial and industrial companies spend huge sums to generate their own power, resulting in high production costs. Only last week, residents of Yenagoa stormed the streets to protest a blackout that left them without electricity for about 10 days.

  • NERC orders DisCos to increase tariff from Jan 1

    The Nigerian Electricity Regulatory Commission (NERC) has directed the 11 electricity distribution companies (DisCos) to increase their tariff effective from January 1, 2020.

    The NERC published the new tariffs for the different DisCos and categories of customers on its website via its order dated 31st December, 2019, which its chairman, Prof. James Momoh and Secretary Dafe Akpeneye issued in Abuja on Saturday.

    It was titled: “NERC in the matter of the December 2019 minor review Multi Year Tariff Order (MYTO) for Abuja Electricity Distribution Company Plc.”

    The commission said that this order supersedes “other orders issued on the subject matter, and shall take effect from 1st January 2020 and shall have effect on the issuance of a new Minor Review Order or an Extraordinary Tariff Review Order by the NERC.”

    It noted that the order has taken into consideration of the actual changes in relevant macroeconomic variables and available generation capacity as at October 2019 in updating the MYTO operating -2015 Tariff Order for 2019 in line with the provisions of the amended MYTO Methodology.

    It said that projections are made for the variables for Year 2020 and beyond based on the best available information .

    The commission however based adjustments in the tariff on the relevant data it obtained from the Central Bank of Nigeria (CBN) and National Bureau of Statistics (NBS) such as average monthly inflation rate of 11.3 per cent, exchange rate of N309.97.

    It also added that it obtained its data on inflation rate from the US rate of inflation , which projected 1.8 percent for the period of January to October 2019.

    Gas, which is one of the MYTO variables, according to the commission, its price has been $2.50/MMBTU and gas transportation $0.08/MMBTU.

    For the Abuja Electricity Distribution Company (AEDC) residential customers R3 that were paying N27.20 per unit are to now pay N47.09.

    The customers are now to pay N19.89 more per unit. It represents 236.75 per cent increase.

    The commercial customers C3 that paid N27.20 per unit in 2015 when the tariff was last adjusted and implement are now to pay N47.09 in 2020.

    For the Ikeja Electricity Distribution Company Customers, the R3 category paying N26.50 per unit is to now pay N36.92 per unit.

    The customers are now to pay additional N10.02 per unit.

    This is an indication of 368.49 per cent increase. The commercial customers C3 that paid N24.63 per unit in 2015 are to now pay N38.14 per unit.

    The customers are to pay additional N13.51 per unit representing 282.30 percent .

    For the industrial customers of the IKEDC D3 that paid N25.82 per unit are now to pay N35.85 per unit.

    The difference is now the additional 10.03 per unit, representing an increase of 357.42 percent.

    Enugu Electricity Distribution Company residential (R3) customers that were paying N27.11 per unit in 2015 are to now pay N48.12 per unit.

    The customers are to pay additional N21.01 per unit, which indicates 229.03 percent.

    The tariff however insisted that “All DisCos are obligated to settle their market invoices in full as adjusted and netted off by the applicable tariff shortfall.

    “in the determination for compliance to the minimum remittance threshold in this Order, the commission shall consider verified receivables from MDAs for the settlement period and DisCos’ historical collection efficiency for MDAs.

    “The commission shall hold the TCN responsible for deviation from the economic dispatch Order that adversely impact on the base weighed average cost of the wholesale of the energy”

    “All FGN intervention from the financing plan of the PSRP for funding tariff shortfall shall be applied through NBET and the MO to ensure 100 percent settlement of invoices issued by market participants.

    “Under this framework, the minimum market remittance by AEDC is determined after deducting the revenue deficient arising from tariff shortfall from the aggregate NBET and MO market invoices. AEDC shall be availed the opportunity to earn its revenue requirement only upon fully meeting the following obligations and subject to efficient operations.”

    According to the order, the Federal Government’s updated Power Sector Recovery Program envisaged an immediate increase in end -user tariffs until 1st April 2020 and a transition to full cost reflectivity by end of 2021.

    In the interim, said the commission, Federal Government, has committed to fund the revenue gap arising from the difference between cost reflective tariffs determined by the commission and the actual end-user tariffs payable by customers.

    The NERC explained 100 percent settlement of MO invoice based on the tariffs applied by the MO in determining respective invoices prior to this order.

    The commission said that effectively, this order places a freeze on the tariffs of TCN and administrative charges until April 2020 at the rates applied in generating MO invoices for the period of January -October 2019.

    NERC insisted that full settlement of 42 percent of NBET’s monthly invoices being the minimum remittance threshold prescribed in this order.

  • Nationwide blackout as power grid collapses

    Nigeria was yesterday thrown into darkness as the National Electricity Transmission System, also known as power grid, suffered total collapse for the 12th time between January 1 and December 11, 2019.

    The collapse came exactly 32 days after the last failure pushed distribution companies across the country into power load shedding.

    The National Electricity Transmission System is being managed by government-owned Transmission Company of Nigeria (TCN), and it has continued to suffer system collapse over the years amid lack of spinning reserve that is meant to forestall such occurrences.

    One of the nation’s distribution companies, Eko Electricity Distribution Plc., confirmed the collapse, informing residents of estates on its network that the prolonged power outage, which they suffered yesterday, was caused by the collapse.

    Stating that efforts were being made by EKEDC engineers to rectify this and restore power to the estates, the utility company informed residents that the prolonged power outage being experienced was as a result of system collapse from the national grid.

    This is not the first time that the company has issued apology to residents over collapse.

    On November 9, EKEDC stated that the grid collapsed at 11:15p.m. on Friday and 3:15 a.m. on Saturday. It was experienced across all transmission stations at 23:15hrs on the day.

    “Supply was received at 03:15hrs. Sadly, at 04:38hrs, the system collapsed again. TCN and our team are working to restore supply. Kindly bear with us,” the Disco said on its Twitter handle.

    Another Disco, Jos Electricity Distribution Plc., announced to its customers that “there is power outage in all our franchise states due to system collapse nationwide.
    “We will provide an update shortly. Thank you for bearing with us,” it said.

    Just three months ago, the power grid suffered a major collapse, the ninth in 2019.

    The nation’s power grid, it would be recalled, also recorded its eighth total collapse in July, plunging consumers across the country into blackout for some hours.

    The government-owned TCN, which manages the grid, blamed electricity distribution companies for the system failure.

    The grid had suffered four total collapses in January and one each in February, April and May, according to the system operator.

    Efforts to reach TCN for reaction on the latest collapse proved abortive. Neither a text message nor a call made to the company’s spokesperson was successful.

    The TCN had, in a statement, said the incessant system collapse was due to high voltage following a massive drop of load by the electricity distribution companies.

    The DisCos’ revenue collection, despite the incessant power supply epilepsy, stood at N118.9 billion in the second quarter, up from N114.6 billion in Q1, a data obtained from the Association of National Electricity Distributors (ANED) confirmed the revenue collected as bills from customers.

    ANED, the umbrella body for the DisCos, said energy received in Q2 dropped to 6,912.8 gigawatt-hours from 6,950.8GWh in Q1, with energy billed being 5,587.5GWh (an equivalent of N180.8bn) and 5,576.8GWh (N176.5bn), respectively.

    The DisCos’ collection efficiency improved to 66 per cent in Q2 from 65 per cent in Q1.

    “The energy received by DisCos in Q2 was less than the amount received in Q1 for most of the DisCos. Only Abuja Electricity Distribution Company, Ikeja Electric, and Kano Electricity Distribution Company received more energy,” the association said in the document.

    ANED said: “In a yearly comparison, the revenue collection of all DisCos has increased in N47 billion (12 per cent), mostly due to the reduction of the aggregate technical, commercial and collection losses from 50.8 per cent to 46.7 per cent.”

    It said that the aggregate technical and commercial losses went down from 23 per cent to 20 per cent and collection efficiency increased from 63 per cent to 66 per cent.

    The DisCos collected N453 billion as revenue from July 2018 to June 2019, compared to N406 billion paid by consumers from July 2017 to June 2018, according to the data.

    “Nevertheless, some DisCos show signs of fatigue in their ATC&C performance improvement in the last months.

    “Ikeja Electric has broken a new record in the ATC&C losses with 26.1 per cent in June, reducing 5.5 points in one year,” ANED said.

    It said two other DisCos, Kano Electricity Distribution Company Plc. and Jos Electricity Distribution Plc., reduced the ATC&C losses in the last 12 months by 8.6 points and 11.6 points, respectively.

    “For this year, most of the DisCos have not been able to beat their last year records on collection efficiency,” the association added.

  • Estimated Energy Billing: Reps pass bill to prohibit DISCOs

    By Emman Ovuakporie
    Members of the House of Representatives on Thursday endorsed a bill for an act to amend the electric power reform act to prohibit and criminalise estimated billing by the electricity distribution companies.
    The House had passed the Bill in the eighth national assembly but was recently reintroduced after the senate failed to concur.
    If it finally becomes law it aims to criminalise estimated billing and make the installation of prepaid meters compulsory for all power consumers in Nigeria.
    Bill estimation is a standard practice used by power providers when an actual meter reading is not available for billing purposes.
    Femi Gbajabiamila, sponsor of the bill and speaker of the house, had said it was not justifiable to continuously charge consumers for power not consumed.
    He had also warned that the green chamber will not allow electricity providers extort Nigerians through estimated billing.
    Recall that stakeholders in the power sector kicked against the bill at a recent public hearing.
    Babatunde Fashola, Minister of Power, works and housing, the Nigerian Electricity Regulatory Commission (NERC) and the Association of Nigerian Electricity Distributors (ANED) had opposed the bill.
    According to the stakeholders, the bill will worsen the electricity situation in the country.
    Fashola had said the bill could crumble the electricity sector, noting that the financial challenges of metering must first be addressed.
    The minister had said: “I take it that we all know what is core mandate. Their(DisCos) core mandate is to supply energy. My view is that let new players be licensed to have the supply of meters as their core mandate to take the load off the DisCos.
  • Buhari tasks Siemens, TCN, Discos on 11,000 megawatts by 2023

    President Muhammadu Buhari on Monday challenged Siemens, distribution and transmission companies and the electricity distribution company of Nigeria to work hard to achieve 7,000 mega watts by 2021 and additional 11,000 mega watts by 2023 and overall grid capacity to 25,000 megawatts.
    He gave the charge when the Federal Government of Nigeria signed electricity road map agreement with German-based Siemens at the Presidential Villa, Abuja.
    The deal is the product of a meeting President Muhammadu Buhari held with German Chancellor, Angela Merkel on August 31, 2018.
    Buhari reaffirmed his commitment to development of the Mambilla hydro electric and various solar projects in the country.
    Buhari said “Our goal is simply to deliver electricity to Nigerian businesses and homes. My challenge to Siemens, our partner investors in the Distribution Companies, the Transmission Company of Nigeria and the Electricity Regulator is to work hard to achieve 7,000 megawatts of reliable power supply by 2021 and 11,000 megawatts by 2023 – in phases 1 and 2 respectively.
    “After these transmission and distribution system bottlenecks have been fixed, we will seek – in the third and final phase – to drive generation capacity and overall grid capacity to 25,000 megawatts.
    “With our strong commitment to the development of Mambilla Hydroelectric and the various solar projects under development across the country, the long-term power generation capacity will ensure adequate energy mix and sustainability in the appropriate balance between urban and rural electrification.
    “Our intention is to ensure that our cooperation is structured under a Government-to-Government framework. No middlemen will be involved, so that we can achieve value for money for Nigerians.
    “We also insist that all products be manufactured to high quality German and European standards and competitively priced.
    “This project will not be the solution to ALL our problems in the power sector. However, I am confident that it has the potential to address a significant amount of the challenges we have faced for decades.
    “It is our hope that as the power situation improves, we will improve investor confidence, create jobs, reduce the cost of doing business and encourage more economic growth in Nigeria.” he said
    He thanked the group for the roles being played towards dramatically improving the quality of Nigeria’s electricity supply.
    Fixing the power sector, he said, was a key priority for his administration.
    “We all know how critical electricity is to the development of any community or indeed any nation. And in Nigeria, whilst we are blessed to have significant natural gas, hydro and solar resources for power generation, we are still on the journey to achieving reliable, affordable and quality electricity supply necessary for economic growth, industrialization and poverty alleviation.” he said
    Noting that there have been many attempts at solving the electricity problem in Nigeria, he said that previous governments have explored State funded solutions through the ill prepared National Independent Power Projects.
    He also recalled that past governments explored installation of large emergency power projects.
    President Buhari said that past governments also embarked on partial privatization of the power generation and distribution sectors.
    These various interventions to solving the electricity problem, he said, have yielded an imbalance between the amount of power generated and the amount available for consumers.
    Despite over 13,000 megawatts of power generation capacity, Buhari noted that only an average of 4,000 megawatts reliably reaches consumers.
    He added “Now, we have an excellent opportunity to address this challenge.
    “This Government’s priority was to stabilise the power generation and gas supply sector through the Payment Assurance Facility, which led to a peak power supply of 5,222 MW. Nonetheless, the constraints remained at the transmission and distribution systems.
    “This is why I directed my team to ask Siemens and our Nigerian stakeholders to first focus on fixing the transmission and distribution infrastructure – especially around economic centres where jobs are created.
    “Whilst it was evident that more needed to be done to upgrade the sub-transmission and distribution system, our Government was initially reluctant to intervene as the distribution sector is already privatised.
    “I am therefore very pleased with the positive feedback from private sector owners of the distribution companies, who have all endorsed Government’s intervention to engage Siemens on this end-to-end plan to modernise the electricity grid.” he stated
    The Global Chief Executive Officer of Siemens, Joe Kaeser, said the road map will enable the country deliver the country’s capacity of power in the first phase of 7,000, second phase up to 11,000 and third phase 25,000 megawatts.
    “That will significantly enhance the country’s power supply and gets the country to the next industrial phase. We believe we will all very much benefit together, the people of Nigeria and of course Siemen as a company.
    “I’m very honured that we were able to sign this road map today in the presence of President and our partners. I will personally make sure that this will be the big success of Nigeria, Siemen and our partners in the country.”
    On the cost of the project and how long it will last, Kaeser said: “We have really talked about solutions and how it can bring power to the people literally, from generation to transmission and effective distribution. Yes, we have been talking money at this time because this about a long term partnership and is a road map which we are going to work all the way till 2025.
    “The first phase is suppose to be done by 2021, second phase till end 2023 and the final phase by 2025.”
    The Director General of Bureau for Public Enterprises (BPE), Alex Okoh, while fielding questions from State House Correspondents, described the partnership as credible.
    He said what has been done so far is the technical evaluation from both the transmission and distribution to know essentially what the gaps are in terms of the technical infrastructure to improve the transmission and distribution capacity.
    Okoh said the next phase is to do the detailed commercials and see costing of what the Siemen intervention will entail before they will agree on the financial frameworks to domicile the financial commitment within the books of the DISCOS.
    “If you look at the amount of losses that is being experienced in the entire power sector, there are huge. We are talking about double digits losses between 30 percent and in some DISCOS almost 70 percent ATC and C losses. So that is a strong signal that the way the market is currently structured is not sustainable and if we don’t improve the critical infrastructure in terms of the winning capacity of TCN and also the distribution capacity of the DISCOS, then this kind of situation will persist for a long time.
    “That is why we welcome this intervention and we believe that within the timelines that have been directed by Mr. President, we will be able to significantly improve power supply in the country.” he said