The Minister of Power, Works and Housing, Babatunde Fashola has directed the Nigerian Electricity Regulatory Commission (NERC) to immediately step in to ensure that Electricity Distribution Companies (DisCos) improve on their distribution equipment and increase capacity to enable them optimize the use of electrical resources by the Generation Companies (GenCos).
Fashola, who spoke at a press briefing on the “Power Sector State of Play, Next Steps and Policy Directives”, also directed NERC to enforce the contract of DisCos to supply meters and act to ensure the urgent speedy supply and installation of meters with a view to eliminating estimated billing and promote efficient industry and market structures.
The minister, who said the improvement in their distribution equipment and increase in capacity would enable the DisCos take up the available 2,000MW difference between the generation capacity of the GenCos and the distribution capacity of the DisCos, also directed the regulatory commission to stop DisCos from threatening private entrepreneurs from entering the market to supply consumers whom they are unable to supply.
Instead, according the minister, such entrepreneurs should be licensed by the commission subject to its terms and conditions “in order to promote competition and private sector participation and avoid a private monopoly of power”, adding that as clearly stated in Section 71(6) of the Electric Power Sector Reform Act (EPSRA) dealing with Terms and Conditions of licenses, “no exclusivity or monopoly was intended for a license holder such as GenCos or DisCos.”
Recalling that when the public complained about the tariff approved by NERC, he was the one that stood in the forefront of explaining to the public even though it was the Discos who collect the tariff, Mr Fashola declared, “In the face of this picture, where we have power to sell, with more to come, the number of complaints coming to Government for meters, which the DISCOs should supply, and for estimated billings, and mass disconnections when not everybody is owing, cannot continue”.
“Government must act, and will do so. The DisCos bought these assets with their eyes opened, and they must compete to deliver or exit”, Fashola declared, adding that Small businesses who need very little power are not getting enough because the DisCos could not take the power to them.
The minister expressed dismay that investment of GenCos was threatened because they could not utilise the capacity they have installed, adding that in order to improve service to small businesses, Government, acting through the Rural Electrification Agency (REA), was linking Small Power Entrepreneurs with markets like Ariaria in Aba, Sabon Gari Market in Kano, and Sura Market in Lagos which, according to him, contain approximately 37,000, 13,000, and 1,047 shops respectively, which are being metered by the small entrepreneurs who have offered to replace the generators of traders with more efficient power and meters.
