Discos: No Plan to Raise Electricity Tariffs

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  • Discos: No Plan to Raise Electricity Tariffs

Dousing mounting concerns over another hike in electricity tariffs, the Association of Nigerian Electricity Distributors (ANED) wednesday said it had no plan to increase the current tariffs being paid by consumers.

ANED’s Executive Director, Research and Advocacy, Mr. Sunday Oduntan, disclosed this in a telephone interview with the News Agency of Nigeria (NAN) in Lagos.

He said the electricity distribution companies (Discos) had not submitted any proposal to the Nigerian Electricity Regulatory Commission (NERC) on a tariff increase.

“It is not true that we want to the increase tariff by 200 per cent because we do not have any right to do so.

“When you talk about tariff review or increase, it is the responsibility of a regulator and that work belongs to NERC.

“We should understand how the system works because it is the work of the regulator to decide whether there should be tariff review or not and not Discos,” said the ANED official.

He urged the National Assembly to reconsider the stoppage of the bond provided by government to address the liquidity challenge bedeviling the power sector.

“We are not asking for subsidy but that government should step in and provide a bond,” he said.

Oduntan said that the business of electricity distribution was currently not bankable because no bank would lend the Discos money with the huge deficits on their books.

TCN Targets 6,000MW

In a related development, the House of Representatives Committee on Power has ordered the Transmission Company of Nigeria (TCN) to shun any financial or monetary requests from its former management contractor, Manitoba Hydro International Nigeria Limited.

This is as the TCN pledged to strive to attain the generation target of 6,000 megawatts (MW) before the end of this year.

The committee issued the directive during an oversight visit to TCN late Tuesday, where members of the committee also queried why the company had been unable to execute most of its projects despite having received more than 50 per cent of its 2016 budgetary appropriation.

The lawmakers also expressed their displeasure over the inability of TCN to install a tower testing facility in Nigeria, particularly as there is no such facility in sub-Saharan Africa.

The committee chairman, Hon. Dan Asuquo, said Manitoba, which managed TCN for the last three years, did not add any value to the development of the nation’s power sector.

“No penny should be paid to Manitoba, or else you’ll go to jail. Manitoba has been here for three years, and there’s nothing to show for it. We can see that Manitoba did not add value to our system when they were here.

“Our capacity was no where near where we are now but since they left, Nigerian engineers that understudied them have been in charge and are responsible for raising our capacity to 5,500MW.

“In view of this, they should not be paid if they come up with any request,” he said.

Speaking on the tower testing facility, Asuquo said the TCN ought to have taken the initiative to provide the facility, as its unavailability undermines technology development in Nigeria.

“We ought to have taken advantage of that which would have saved us foreign exchange and stopped capital flight since samples of the towers have to be taken abroad for testing.

“This is arm twisting us to go abroad considering the fact that we have the resources that can turn this into a huge revenue generating facility on the continent of Africa.

“Even allied sectors like the steel rolling mills in this country stand to benefit,” Asuquo said.

The Managing Director of Transmission Service Provider (TSP), Mr. Tom Owan blamed factors beyond the control of the TCN for its inability to execute some projects despite the availability of funds.

Some of the factors include social issues at project locations, contract variations, and the challenge of clearing equipment from the seaports. He however added that most of the issues were close to resolution.

He said the TCN’s target was to increase power generation to 6000MW before the end of the year.

The House, in adopting the report of the Committee on Power, had advised the federal government not to renew Manitoba’s contract which expired in July 2016, due to the inability of the company to meet its key performance indicators (KPIs) under the management contract.

Meanwhile, the Federal Executive Council (FEC) yesterday approved the construction of the 215MW Kaduna power plant following a memo presented by the Minister of Power, Works and Housing, Mr. Babatunde Fashola (SAN).

Fashola said the project, which would be completed by next year, was expected to add 215MW to the national grid. He said part of the power would be dedicated to Kudan Dam in Kaduna State to support the industrial complex there.

Fashola said council also approved the construction of a sub-station to evacuate 40MW of power from the Gurara hydro electric power station, phase one, to connect to Kaduna and to enable it interconnect to the Mamdo transmission sub-station. This, he said, would strengthen the transmission grid.

Fashola said measures had been put in place to ensure that power generation does not drop during the dry season.

About the Author

Samed Olukoya
Samed Olukoya is the CEO/Founder of investorsking.com, a digital business media, with over 10 years' experience as a foreign exchange research analyst and trader. A graduate of University of East London, U.K. and a vivid financial markets analyst.

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