NERC to reduce Discos’ Opex by 50% for poor performance
NEMSA harps on safety as regulator seeks metering compliance
THE Nigerian Electricity Regulatory Commission ( NERC) said the operating expenses of distribution companies ( Discos) who failed performance efficiency would be reduced by 50 per cent.
This comes as the Nigerian Electricity Management Services ( NEMSA) raises concerns over safety issues and threats to human lives and properties in the power sector.
NERC, at its first quarter stakeholder engagement, has also warned distribution companies to meter consumers who have paid for the units immediately.
The commission has also disclosed that a payment system has been made to address billings of critical government ministries and agencies.
NERC Vice Chairman, Musiliu Useni said there is a need to ensure that sustainable payment going forward is in place.
Useni noted that while the market rules in the sector are clear, they didn’t envisage that there would be a tariff shortfall or subsidy. Useni urged the Discos to improve their performance or suffer consequences.
“NERC will look at performance on a case- by- case basis. Sanctions and actions will not be the same. Ensure that you improve your efficiency. If your efficiency is at the level expected, you will get your full OPEX. If you don’t perform, you will only get 50 per cent of your admin OPEX. “A payment system was put in place for critical MDAS, with an agreement for the central settlement of their electricity consumption by the Ministry of Finance, which would have access to their meter readings,” he said.
NERC Commissioner, Legal, Licencing and Compliance, Dafe Akpeneye said that is a lack of communication by Discos to their customers waiting to be metered.
Dafe said: “NERC expects Discos to meter paid customers within 10 days. Currently, there is a communication gap with customers. Once they pay, you need to communicate with them and give them an installation date. Instead, the customer pays, hears nothing and continues to wait in perpetuity.”
NERC Commissioner, Finance and Management Services, Nathan Shatti Rogers, stressed that the utility companies must meter customers at the price the asset was when they initially paid, insisting that they can’t charge them more.
“Customers should not pay for meters when you don’t have meters in stock. If you collect customers’ money, then you have to install meters for them at no additional cost regardless of when you install them, Rogers said.
Managing Director of NEMSA, Aliyu Tahir, while calling for stronger synergy with NERC to enhance safety in the power sector said: “The synergy between NERC and NEMSA should be quickly enhanced. We have seen decay in the network, and all this is linked to the safety of lives and property. The order that has been approved will go a long way in reducing accidents. We must work together for the safety of lives and property in the NESI.”