DisCos lose N48 per unit as NERC stalls power tariff for 30 months

The 11 electricity Distribution Companies (DisCos) said they lose an average of N48 per kilowatt hour (KWH) of electricity due to the deliberate stoppage of a new tariff in the past 30 months.

A statement by the Association of Nigerian Electricity Distributors (ANED) Sunday said the shortfall from the stalled tariff review by the Nigerian Electricity Regulatory Commission (NERC) driven by the Minister of Power, Works and Housing, Mr Babatunde Fashola had impeded performance of the DisCos in a capital intensive power sector.

Fashola in a statement last weekend  ordered the DisCos to pay about N728 billion debt they owe the Nigerian Bulk Electricity Trading Plc (NBET) for generated power, accusing them of under-performing.


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“Through the regulatory and policy actions that have been principally driven by the Minister, the DisCos have been forced to sell their product which should retail for an average retail tariff that is more than N80/kWh, at an average retail price of N32/kWh,” the DisCos responded.

They noted that rather than channeling investments to improve the debt-stricken mainstream power sector, the Federal Ministry of Power, Works and Housing through the Rural Electrification Agency (REA) is using tax payers’ funds to do a bloated 3 megawatts (MW) project in Sokoto valued at $5.6 million (about N5.2 billion) per MW; and $2.02m (N4.04bn) per MW for 2MW project in Anambra.

“Why is this remarkable? It is remarkable because the government has robustly challenged, as exorbitant, the proposed price of $1.5m/MW put forward by power developers from the private sector and sought a reduction of same,” the DisCos claimed.

The private investors in the distribution section of the value chain also said Nigerians were not getting value for taxpayers’ funds being channeled to misguided projects by REA, the Transmission Company of Nigeria (TCN) and “friends”.

The statement partly read: “Should the unserved rural dwellers, who should be legitimate beneficiaries of REA’s funding and services, continue to live in darkness, due to the Ministry’s and REA’s mis-guided priorities?

“Should TCN, an entity without a distribution license, continue to engage in opaque “Eligible Customer” transactions, rather than investing its limited funding in expanding and stabilizing the grid, for increased energy to our customers,” the DisCos said.

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