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8-DisCos Risks Their Licenses Over N30.1bn Debt: NERC

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The Nigerian Electricity Regulatory Commission (NERC) has informed eight power Distribution Companies (DisCos) on its plan to cancel their licenses in 60 days due to accumulated debt of N30.1 billion naira energy invoice of July 2019 to date.

 

Vigil360 gathered in a letter of notice signed by Dafe Akpeneye, the Commissioner for Legal, Licencing and Compliance of NERC, issued on 9th October 2019. In the notice, NERC directed Abuja, Benin, Enugu, Ikeja, Kano, Kaduna, P/Harcourt, and Yola DisCos to prove why their licences should not be revoked in two months ahead.

Also, the Commission explained further that the DisCos are non-compliant over remittances.

It was quoted as “The remittances to the Nigerian Bulk Electricity Trading Plc (NBET) shows that the DisCos have failed to meet the expected minimum remittance thresholds for the July 2019 billing cycle,”.

The statement reads.
 
According to NERC, the eight DisCos received N36.1bn invoice from NBET for the energy they received in July, 2019, they only remitted N5.91bn, representing just 16 per cent performance.

They are getting NERC sanction for the balance of N30.1bn.

Further analysis indicate that, in the month of July, 2019 NBET energy invoice shows that Enugu DisCo has the highest failure rate.

NERC added that the minimum it could remit was 42% from its N4.112bn invoice, but the DisCo remitted only N400 million, representing just 10%.

Abuja DisCo was to remit 45% of the N7.2bn invoice but it remitted 30% which was N2.152bn.

Benin DisCo failed to remit 30% of N4.37bn bill but did N771.7m (18%); Port Harcourt DisCo was next in the failure rate.

It did not remit its 21% minimum for N3.647bn invoice but paid N383m to NBET which was 10%.

Additionally, Kano DisCo did N800m (24%) instead of 33% of the N3.33bn bill; Kaduna DisCo had N3.834bn bill but paid N407.78m which was 11% instead of NERC’s required 18%.

Ikeja DisCo was to pay 49% of N7.4bn but paid 49% which is N2.95bn; Yola DisCo was to pay 13% of N1.95bn energy bill but only did N194.6m (10%).

The Commission observed that the failure of the DisCos to comply with the minimum remittance exposes the Nigerian Electricity Supply Industry (NESI) to risks that threatens its sustenance as well as that of the other parts of the value chain. It has also affected the ability to improve service delivery of electricity to Nigerian consumers.

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