The Nigerian Electricity Regulatory Commission (NERC) has said that it will revise its order on the Fixed Charge, following complaints from stakeholders.
NERC Chairman, Dr. Sam Amadi said this at a public hearing organised by the agency on an order revising the payment of the Fixed Charge component for the Multi Year Tariff Order (MYTO).
He said: “NERC issued an order with ‘Order No: NERC/FC 133’ dated 1st May, 2014, directing that a customer who has not received continuous or cumulative electricity supply for a period of 15 days in a month shall not be required to pay the Fixed Charge, provided that the disruption is not due to non-payment of electricity bills or customers action.”
But the Enugu Disco represented by its Acting Group Manager, Regulatory Affairs, Reuben Okoye submitted that the order was made without due consultations with operators, and that outages are not caused by Discos alone as some may arise from transmission or generation failures.
Okoye said it is difficult to independently determine customers that had outages in a period and that the penalty for outages should pass across the entire value chain.
Also speaking, Director of Eko Disco, Ernest Orji said the rule is difficult to implement as the Discos do not yet have statistical meters to determine such claims from consumers.
“In our submission, we argue that there should be a new structure for Service Charge (SC) and no more FC so that a percentage of supply is given as compensation to consumer or exempt them from paying the SC for that period,” he said.
Engr. Abimbola Odubiyi of the Abuja Disco argued that the order will encourage the culture of consumers not paying their bills. He urged NERC to look into the order to ensure sustenance of market financial progress and extending the rule to the TCN, Gencos and gas suppliers in the case of similar defaults.
Also speaking, the National Vice President of NACCIMA, Alhaji Sanusi Maijama’
who gave an instance of the electricity bills payment said, “If one million consumers pay the N750 FC monthly, then they are paying N750bn to the Discos for doing nothing. I have said earlier that if there is efficient service and every consumer pays his bill, government can generate much more revenue than the oil sector.”
Representative of the Manufacturers Association of Nigeria (MAN), Okpe Sunday said over 95 percent of industries in Idu industrial area of Abuja have been cut off from the grid due to incessant outages.[share_this_post]
He argued that the 15 days outage penalty period is not justified enough for consumers as a day of outage means huge loss, adding that Discos should consult with Gencos and the Transmission Company of Nigeria (TCN) to share such penalties as the FC they collect monthly is also shared among them.
Responding, NERC Chairman concluded that the Commission will consider the submissions which he summarised into: expunging the order, keeping it, and/or revising the order to make for clarity.
Referring stakeholders to the Electric Power Sector Reform Act (EPSRA) 2005, Amadi said: “Discos should note that recouping their investment as entrenched is dependent upon performance and anything short of that will mean cheating on electricity consumers.”