Tag: Sanusi Garba

BREAKING: NERC approves electricity tariffs hike with burden on FG

The Nigerian Electricity Regulatory Commission (NERC) has approved electricity tariffs hike, effective January 1 2024, following a review of the Multi Year Tariff Order.

TheNewsGuru.com (TNG) reports Chairman of NERC, Sanusi Garba made this known on Wednesday during a routine media engagement in Abuja.

Garba, however, disclosed that the burden of the electricity tariffs hike will be on the federal government.

The NERC Chairman stressed the Multi Year Tariff Order review and the electricity tariffs hike are in compliance with the Electricity Act 2023.

Garba said this was after an application for tariff review by DisCos and a public hearing on the rate review.

The Order uploaded on the NERC website states appropriate tariffs that consumers should pay for investors to recover their operating cost.

It also contains the federal government’s policy on ensuring that due to the cost-of-living crisis, consumers will not be made to pay higher than prevailing rates.

Cost of living crisis: FG to continue electricity subsidy – NERC

Mr Sanusi Garba, Chairman, NERC, says the federal government will continue to subsidise electricity to ease the financial burden on Nigerians due to economic challenges in the country.

“Government has decided for now, arising from the cost of living crisis and so many others, to in the meantime continue to subsidise electricity.

“In the new tariff order just published by the commission, you will discover that tariff is not going up but you will see what the Electricity Distribution Companies (DisCos) should be charging.

“You will also see in the tariff order the amount of subsidy the government will be providing to cover the gap between what they will charge and what they are allowed to charge,” he said.

According to him, the new tariff contains what the DisCos are allowed to charge based on government policy, if they are to remain in service.

He said that in the tariff, NERC included some provision that would ensure that the DisCos pay what they are obligated to pay.

“The DisCos are in the business of buying electricity from the Nigeria Bulk Electricity Trading Company (NBET), so they are to pay,” he said.

Garba said that the Electricity Act that was signed by President Bola Tinubu in 2023 presented an opportunity for states to make laws and take charge of providing electricity in their franchise areas.

He said that the commission remained committed to working with the states in such a manner that the existing public utilities were nurtured to provide services to Nigerians and were utilised for what they were intended for.

On metering, the chairman said that the commission had identified that the Electricity Distribution Companies had challenges with finances to meter their customers.

He said that the rate of metering had been adversely impacted by the inability of DisCos to raise the required capital from the banks.

“To reduce the rate of estimated billing, the commission created a framework under which the distribution companies can raise some amount of money to meter customers.

“So we decided that from the market revenues, we set aside a fixed amount that is dedicated for the provision of metering

“We are not saying that the money from the market on a monthly basis is the money to buy a meter.

“It is a potential lender to raise a pathway to pay whatever loan DisCos are going to get to provide meters,” he said.

January 18, 2024
Real reason NERC ordered increase in prices of prepaid meters

The Nigerian Electricity Regulatory Commission (NERC) has approved an increase in the price of electricity pre-paid meters in the country.

This is contained in a NERC ‘order’ signed on Tuesday by its Chairman, Mr Sanusi Garba and the Commissioner, Legal, Licensing & Compliance, Mr Dafe Akpeneye obtained by newsmen on Wednesday in Abuja.

The commission, in the order said that a single phase pre paid meter would now cost N81,975.16 from the N58,661.69 it was previously while three phase pre paid meters would cost N143,836.10 from N109,684.36.

It said that “significant changes in macroeconomic indicators, such as inflation and changes in the foreign exchange rates have necessitated a review of the regulated rates for MAP meters.

The commission also stated that the approved meter prices were exclusive of the 7.5 per cent Value Added Tax (VAT).

It said the new price regime was to ensure a fair and reasonable pricing of meters to both MAPs and end-use customers.

“Ensure Meter Assets Programme (MAP)’s ability to recover reasonable costs associated with meter procurement and maintenance while ensuring that their pricing structure allows for a viable return on investment.

“Evaluate the affordability of meter services for consumers, aiming to prevent excessive pricing that could burden end-users. Ensure that MAPs are able to provide meters to end-use customers in the prevailing economic realities,” it stated.

September 6, 2023
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.

May 15, 2023
Nigerians to enjoy improved power supply from July 1 – NERC

Mr Sanusi Garba, Chairman, Nigerian Electricity Regulatory Commission (NERC), says Nigerians will witness improved power supply from July 1 following renewed efforts by industry stakeholders.

Garba gave the assurance at an interactive session with newsmen after the Second Nigerian Electricity Supply Industry (NESI) meeting on Wednesday in Lagos.

TheNewsGuru.com recalls that the national grid has collapsed five times this year and was on Sunday only able to supply 9MW of electricity.

The meeting was attended by top officials of NERC, Transmission Company of Nigeria (TCN), Generation Companies as well electricity Distribution Companies.

He said NERC had facilitated a contractual agreement between the Gencos, TCN and the 11 DisCos that would guarantee the generation, transmission and distribution of an average of 5,000MW of electricity daily to customers effective July 1.

According to him, the contract is binding on all the players across the sector’s value chain and stipulates penalties for any party that defaults on the arrangement under the new regime.

Garba said: “Yes, we have had discussions with the gas suppliers within our regulatory space. We have them on board to ensure that once we made the commercial requirements, gas was going to flow.

“Now, for transmission we have heard of figures well in excess of 5,000MW and clearly TCN will be able to deliver that.

“I recall clearly in March last year we had 5,400MW. So, it means it is quite possible based on signed commitments.”

He said all the stakeholders across the value chain had obligations and there would be consequences if they failed to deliver.

“So, in a situation where Gencos are able to deliver 5,000MW but TCN is unable to do so, they’ll pay the penalty to the generation company and so on.

“And whenever the power is available and DisCos do not take the power;

then they will pay liquidated damages that will compensate other market participants.

“We might not have 24/7 power supply from July 1 but Nigerians will see the trajectory because the target is to have an average of 5,000MW daily for transmission and distribution,” said Garba.

He also blamed the recent collapse of the national grid on inadequate gas supply, maintenance of some thermal stations as well as vandalism of power infrastructure and gas pipelines.

“The challenges of today are very clear. In the past, it used to be weak infrastructure and so on and so forth. Now we have certain external factors contributing to these events.

“Obviously, it’s not common around the world to see people coming down, pulling down transmission towers for no reason; or blowing up crude oil lines.

“In a number of instances, most of the gas we have today is associated gas and because of that when crude lines are disrupted it also affects the supply of gas to the thermal stations,” he said.

Garba commended the Federal Government and the Central Bank of Nigeria (CBN) for the interventions in the power sector, adding that country would soon start feeling the impact of the investments positively.

June 16, 2022
Electricity: No new tariff review approved by NERC – Chairman

Mr Sanusi Garba, the Chairman, Nigerian Electricity Regulatory Commission (NERC), says the commission has not approved any new tariff rate review in recent times.

Garba told newsmen in Abuja on Friday that the last tariff review was approved on Dec 31, 2021, and became effective in February 2022.

“I want to, on behalf of the management of NERC, clearly state that as of today, we have not approved any rate review and no indication that any Electricity Distribution Companies (DisCos) is increasing its tariff.

“If you notice that the rate you buy tariff has changed within the last one to three weeks, we want evidence. The information posted on the NERC website was the last tariff rate review in December 2021.

“Our function is to approve applications for tariffs for Distribution companies, and we have not received any.

“We have clearly said that we have an obligation by law to do minor review every six months to take care of inflation, FOREX, and so on,” he said.

On the issue of ‘Eligible Customers Regulations’, Mr Musiliu Oseni, the Commissioner, Market Competition and Rates, said that the regulation was still in place.

The eligible customer regulation permits electricity Generation Companies (GenCos) to sell electricity directly to customers whose consumption is more than 2megawatts/hour over the course of one month.

Oseni said that the regulation and the framework were also in place, adding that the commission issued a letter to the market operators to stop the recognition of certain potential customers.

He said that the customers were stopped because at that time, they had not secured the approval of the commission.

“As of today, we have a few customers that have been approved as eligible customers pending the review of the necessary documentation of other customers.

“Some of the customers that are yet to secure approval had some challenges which include that of the inability of their potential generator to sell additional capacity to them.

“Under that framework, many of the generators had a contract with Nigeria Bulk Electricity Trading Company (NBET), and you cannot contract the same capacity twice,” he said.

Oseni said that such generators were already making move to renegotiate the contracted capacity made with NBET to free some capacity to sell to eligible customers.

May 7, 2022
NERC Chairman reveals FG’s plan to stop payment for unused electricity

The Nigerian Electricity Regulatory Commission, NERC, Chairman, Sanusi Garba, has disclosed plans by the Federal Government to stop consumers from paying for unused electricity.

Addressing reporters in Abuja, Garba said issues surrounding the N1.6 trillion debt were technical, as electricity Generating Companies(GenCos) demand its payment.

Garba asserted that GenCos lack the capacity to deliver.

In his words: “It will be reckless to sign agreement for the generation plants for capacity that has not been delivered.”

NERC Vice-Chairman, Musiliu Oseni, also gave insight into the national grid collapse on Monday and Tuesday.

Oseni blamed the development on a conductor snap on a 330 Kilovolts (kV) transmission line along the Benin, Edo State axis, adding that the fault was however said to have been rectified yesterday.

He noted that some of the GenCos have no effective contract on payment of unused electricity.

“If a generation company has effective Power Purchase Agreement (PPA), which provides for payment of a certain level of capacity, then there is an obligation to pay.

“A number of generation companies however has no effective contract that guarantees the payment of the so-called unutilized capacity.

“The good thing is that we are gradually migrating to a point where the generation plants will have capacity payments being somewhere and somehow delivered along the value chain,” he said.

The power sector regulator chieftain also explained that the government has stopped the payment of electricity subsidy, saying the decision to discontinue it (subsidy) was entirely that of the Federal Government.

Adding: “You can’t run the electricity market on life support. In the past four or five years, the payment of subsidy has gradually been reduced to about N30 billion this year. I believe all of you can understand that you cannot run the electricity market on life support and say that the investors should not get their return on investment.

“That policy decision was announced by the Minister of Finance. Subsidy at a point was as high as N600 billion a year. and gradually has dropped to N30 billion this year. So that policy decision is from the government and we take directive from the government.”

On compensating consumers for poor service, especially as outage worsens, Garba said NERC has robust data gathering strategies and would do such.

He said NERC had once compelled Jos DisCo to refund N200 million to consumers for poor service as well as Enugu DisCo.

NERC Vice-Chairman Oseni, who fielded a question on the grip collapse, pointed out that the first system collapse happened due to a conductor snap on the 330 kilovolts Benin transmission line axis.

“It cascaded into the loss of 414 Megawatts of electricity from the Ughelli plant,” he added.

Oseni posited that power generation dropped from the 5,300 Megawatts (MW) average in October 2021 to 4350MW in March.

He stated that it was a dip by about 1000MW on the grid that denied some customers enough supply.

March 17, 2022