18 Jun 2015

Nigerian Electricity Regulatory Commission (NERC) to revoke licences of non-performing electricity firms

The Nigerian Electricity Regulatory Commission (NERC) yesterday announced that it has commenced revoking many of the generation licences that it issued which are ‘non-performing.’

The commission, which reviewed the status of the 120 licences issued since 2006, noted that government had since resolved some of the complaints of the licensees by establishing the Nigerian Bulk Electricity Trading Company (NBET or Bulk Trader) to act as the off taker for the sector.

Also, the Presidency has pledged to garner the necessary investments to improve the wheeling capacity of the nation’s transmission infrastructure.

Vice President, Yemi Osinbajo, who made the pledge, stressed how the new government would focus attention on improving the supply of gas to power plants, which will ensure sufficient gas supply. This, he hopes, would help maximize 13,000mw of generating capacity immediately.

Despite lamenting that many of the licences were yet to move from being mere papers to mega watts of electricity, NERC yesterday in Abuja issued fresh generation licences to four firms with total generation targets of 774 mega watts of electricity.

In issuing the fresh licences, NERC said it had extracted concrete commitments from the promoters of the four benefitting firms to produce power or be sanctioned.

The licences were issued to Nigeria Solar Capital Partners Limited for a 100MW solar-powered IPP at Ganjuwa, Bauchi State; Proton Energy Limited for a 150MW IPP at Ogorode, Sapele, Delta State; Turbine Drives Limited for 500MW IPP at Ajaokuta, Kogi State; and Pan Africa Limited for a 24MW solar-powered IPP at Kankia, Katsina State.

The commission warned beneficiaries of the licences that it would move from its initial ‘lenient’ position with licensees to evoking the relevant provisions of the Electric Power Sector Reform Act (EPSR) to revoke any non-performing licence after an ongoing technical evaluation of the licences.
NERC Chairman, Sam Amadi who announced the revocation of licences noted: “I want to reassure everybody that NERC over the years has built a reputation of consistent rule making and honest application of rules. We can pride ourselves probably as the most transparent agency in this country.

We will continue in the practice of openness, transparency and consultation by following the rules.’’ He said the four new licences had promised to deliver on the terms of their licences.

He stressed: “The major plight of consumers is that they have shorter hours of supply. That is because we have very bigger, mega watts in the grid. By now it should be very obvious to everybody that if you have mega watts, you will get more supply, all things being equal.

In the run up to the inauguration, things were very bad across the country. A place like Abuja was getting only 11mws, because of the strike and the usual issue about vandalism. But a few days after the strike was called off, it ramped up, and Abuja started getting 15-MWs to 200MWs.

The ratio between the amount of power available to the grid and what consumers experience is very clear. It is different relationship. “These new licencees are here pledging to develop new power, different amounts of mega watts to the grid. That is really solving the customers’ problem.

If we were a 10, 000mws market, the experience of consumers will be different. ‘‘There is no hide and seek about it. The commission by law is mandated to guarantee cost reflective tariff. And that is one sure pathway to ensuring supply.

So, the idea of sustainability is also about sustaining quality power supply. We are addressing the plight of consumers by ensuring that we have more mega watts, and these mega watts fairly and reliably distributed to every home and business.”
Credit: Emeka Anuforo/Nigerian Guardian

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