NERC Records 41% Rise in Power In­vestors’ Pay­ments for Op­er­a­tional Per­mits

Fashola de­nies di­vert­ing $600m meant for Mam­billa project

THISDAY - - NEWS EXTRA - Chineme Okafor in Abuja

The Nige­rian Elec­tric­ity Reg­u­la­tory Com­mis­sion (NERC) has said it re­ceived more money in 2017 than it did in 2016 from power sec­tor in­vestors who sought for reg­u­la­tory per­mits or re­new the li­cences they held in Nige­ria’s power mar­ket.

This is com­ing as the Min­is­ter of Power, Works and Hous­ing, Mr. Ba­batunde Fashola, has de­nied dis­rupt­ing the ex­e­cu­tion of con­tracts for the con­struc­tion of the 3,050 megawatts (MW) Mam­billa hy­dro power plant in Taraba State by al­legedly seek­ing to di­vert $600 mil­lion from the project’s con­struc­tion sum for other uses.

Ac­cord­ing to NERC, it re­ceived in 2017, N538.219 mil­lion from in­vestors as pay­ments for new per­mits and re­newal of per­mits, as against N382.708 mil­lion it got in 2016. This rep­re­sented an in­crease of N155.511 mil­lion or 40.6 per cent.

These fig­ures were con­tained in lat­est au­dited fi­nan­cial state­ment of the com­mis­sion for the year 2017 which was posted yes­ter­day on its web­page.

The fi­nan­cial state­ment was re­port­edly pre­pared and sub­mit­ted to the NERC by ac­count­ing firm -Del­loitte&Touche, in Novem­ber 2018.

The re­port was also signed by three com­mis­sion­ers of the NERC - Sanusi Garba, who is the vice chair­man of NERC; Dafe Akpen­eye, com­mis­sioner for le­gal, li­cenc­ing and en­force­ment; and Nathan Shatti, com­mis­sioner for fi­nance and man­age­ment ser­vices.

NERC equally noted that it recorded an in­crease in the amount of money ac­cru­able to it from the to­tal rev­enue of the coun­try’s elec­tric­ity mar­ket, from N8.078 bil­lion in 2016, to N8.661 bil­lion in 2017.

Ac­cord­ing to it, it is statu­to­rily en­ti­tled to 1.5 per cent of tar­iff charges per kilo­watt hour (kWh) from power gen­er­a­tion com­pa­nies (Gen­cos) and an­other 1.5 per cent of li­censee’s charges per kWh net of the cost of gen­er­a­tion and trans­mis­sion of elec­tric­ity.

An­other rev­enue source which the NERC ac­counted for in its an­nual fi­nan­cial state­ment was a N45.750 mil­lion grant it got from the MacArthur Foun­da­tion, in sup­port of its ef­forts to im­prove ac­count­abil­ity and pub­lic knowl­edge of the power sec­tor.

Also, the fed­eral gov­ern­ment gave it a sub­ven­tion of N900 mil­lion to off­set its cap­i­tal ex­pen­di­ture for the pe­riod un­der con­sid­er­a­tion. These thus raised NERC’s to­tal in­come in 2017 to N10.145 bil­lion as against N8.460 bil­lion it got in 2016.

Mean­while, the Min­is­ter of Power, Works and Hous­ing, Mr. Ba­batunde Fashola, has de­nied dis­rupt­ing the ex­e­cu­tion of con­tracts for the con­struc­tion of the 3,050 megawatts (MW) Mam­billa hy­dro power plant in Taraba State by al­legedly seek­ing to di­vert $600 mil­lion from the project’s con­struc­tion sum for other uses.

Fashola, was re­cently ac­cused of at­tempts to di­vert funds from the project, and that his al­leged in­sis­tence on same forced the Chi­nese Exim Bank to hold back fund­ing ne­go­ti­a­tions on the project.

But in a re­sponse to the al­le­ga­tion which his se­nior spe­cial as­sis­tant on com­mu­ni­ca­tion, Mr. Ha­keem Bello, sent to THISDAY, the min­is­ter claimed the al­le­ga­tions were un­true.

He also claimed the al­le­ga­tions were ini­ti­ated to tar­nish his name and im­age, adding that: “Noth­ing is more fur­ther away from the truth than the claim that the loan ne­go­ti­a­tions have stalled since 2017 be­cause of an at­tempt to utilise $600 mil­lion (equiv­a­lent of N219 bil­lion) from the 3,050MW hy­dropower project for a ‘pet project’ not hith­erto con­sid­ered by the Fed­eral Ex­ec­u­tive Coun­cil.”

Ac­cord­ing to him, the China Exim Bank dis­burses money to spe­cific projects, adding that on con­clu­sion of ne­go­ti­a­tions, the loan will be de­voted to the con­struc­tion of the Mam­bila power plant.

“The al­le­ga­tion with re­gard to stalling the Mam­billa project is un­true and base­less. The events and rel­e­vant facts will show that be­cause Mr. Fashola first pre­sented a memo on the Mam­billa power project to the Fed­eral Ex­ec­u­tive Coun­cil in Au­gust 2017; which was the first ever Fed­eral Ex­ec­u­tive Coun­cil ap­proval given to the Mam­billa project in favour of a Chi­nese Joint ven­ture.

“The min­is­ter has also ac­com­pa­nied the pres­i­dent twice to China on trips that had the project as one of the head­line agenda. The min­is­ter in June 2018 at­tended, along­side of­fi­cials of the min­istry of fi­nance, a meet­ing of the China Exim Bank to ne­go­ti­ate the terms of the loan for the project fur­ther.

“And only this week, af­ter the Fed­eral Ex­ec­u­tive Coun­cil meet­ing, he briefed Nige­ri­ans about the ap­proval of con­tracts for sur­vey­ors to de­mar­cate the ar­eas for the project. These are the first con­tracts to start prepara­tory work on the project af­ter 40 years de­lay,” the state­ment ex­plained.

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