The Federal Government of Nigeria has issued a stern warning to underperforming power distribution companies (Discos), declaring that they stand to lose 50% of their operating expenditures if they fail to meet stipulated standards in the Nigeria Electricity Supply Industry (NESI). This announcement was made through the Nigerian Electricity Regulatory Commission (NERC) during the 1st NESI Stakeholders Meeting of 2024 held in Lagos on Monday.
Currently, Nigeria is served by 11 power distribution companies, catering to over 12 million registered power users nationwide. However, concerns persist regarding poor liquidity and the inability of Discos to make sufficient financial remittances to the industry, thereby hindering power production.
Addressing stakeholders at the meeting, Vice Chairman of NERC, Musiliu Useni, emphasized the need for improved efficiency from Discos, warning of consequences for non-compliance. He stated that NERC would evaluate each Disco’s performance individually and impose sanctions accordingly.
Useni highlighted the importance of sustainable payment obligations among industry operators and emphasized the operationalization of centralized billing platforms for Ministries, Departments, and Agencies (MDAs) by the Ministry of Finance.
Commissioner for Engineering, Performance, and Monitoring at NERC, Chidi Ike, outlined plans for a comprehensive workshop to examine licensee responsibilities, covering legal frameworks, grid codes, and health, safety, and environmental standards. Non-compliance would result in sanctions.
Additionally, Assistant General Manager for Engineering, Performance, and Monitoring at NERC, John Joseph, addressed safety concerns, citing that 38% of accidents in 2023 were attributed to unsafe conditions. He emphasized the need for adherence to safety guidelines to prevent accidents.
The meeting aimed to provide strategic direction for NESI, review compliance since the last meeting, and address critical issues affecting the industry. Discos were cautioned against supplying power to structures under transmission lines, as this contravenes safety regulations.
As Nigeria continues to grapple with challenges in its electricity supply sector, the Federal Government and regulatory bodies like NERC are intensifying efforts to ensure accountability, efficiency, and safety within the industry, with a focus on improving service delivery and meeting the nation’s power needs.
