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Revisiting DISCOs’ Mandate

Revisiting DISCOs’ Mandate

THE Minister of Power, Saleh Mamman, said recently that the  Electricity Distribution Companies, DISCOs, have failed in supplying adequate electricity to Nigerian consumers.

HE said his Ministry had submitted a memo to decide the fate of DISCOs, who have failed to honour their commitments to buy and distribute adequate power generated for them by the generation companies, GENCOs.

HE said although Nigeria’s current generating capacity was about 13,000 megawatts, only about 7,000 megawatts was transmitted.

HE explained that the DISCOs do not evacuate all of the 7,000 megawatts generated by the GENCOs, but pay only 15 per cent for the 3,000 megawatts they eventually distribute.

HE said the implication was technical and economic losses, as the GENCOs don’t get value for the electricity they generate, adding that the end consumers also do not get adequate electricity, despite the output of the GENCOs.

WE believe the minister is speaking the mind of many Nigerians, when he said DISCOs have failed to carry out their responsibility to consumers.

SOME years ago, the Federal Government unbundled the Power Holding Company of Nigeria (PHCN) and handed over 18 utility firms to private investors.

THE government raked in $2.5 billion from the transaction involving six generation companies (GENCOs) and 11 Distribution Companies (DISCOs).

UNFORTUNATELY, the move has not brought sanity to the power generating sector of the country’s economy nor bring smiles to the faces of distraught customers.

THE Nigerian Electricity Regulatory Commission (NERC) in December concluded the review of responses submitted by DISCOs and stated that some of them reportedly abuse sections of the Electric Power Sector Reform Act (EPSRA) 2005.

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THEY had failed to meet up with the minimum revenue remittance thresholds, thereby breaching the provisions of the EPSRA 2005 terms and conditions of their respective distribution licenses.

NIGERIAN consumers regularly accuse DISCOs  of arbitrary billing and group disconnection of electricity, which many consider an infringement on their human rights.

COMPLAINTS are not just restricted to the crazy billing, but complaints also extend to the tendency of DISCOs to bill for non-existent supply, leading to a situation where many don’t take them serious, as it is outrageous to pay for non-existent electricity supply.

DISCOs are able to bill consumers outrageously because they have refused to give consumers pre-paid meters, so  they can give arbitrary, unreasonable and unsupported billing.

AS at December 31, 2017, a NERC metering report said 4.7 million electricity consumers were not metered, representing 55 per cent of the about eight million registered electricity users NERC identified.

TWO years later, the conditions have in fact worsened, with many not comfortable about DISCO’s stands on meters.

IN many parts of the country, the power situation is at its lowest ebb, as majority of the residents hardly get six hours electricity from some of the DISCOs.

A survey showed residents contribute money to buy and repair faulty transformers, whereas it is the responsibility of DISCOs to perform this function.

ALTHOUGH the poor state of electricity supply is a testimony that successive governments have failed to address the issue, but this does not mean it should not be revisited, and the current government has a responsibility to review the structure through which DISCOs operate.

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IN view of this, we support Mamman’s claims that DISCOs have failed the nation in their mandate to supply the nation with an adequate quantity  of electricity.

WE believe the monopoly of DISCOs  should be broken, so states and other stakeholders are given the freedom to invest in power generation and distribution, a move that would lead to healthy competition and efficiency.

WE believe DISCOs should be made to distribute the amount of power generated by the GENCOs, because it is fraudulent of them not to do so, as it raises questions about their usefulness.

IF they are unable to do this, it stands to reason that the present structure in the power sector should undergo another radical restructuring and Nigerians are eagerly awaiting the  needed change.

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Revisiting DISCOs’ Mandate

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