Nigerian govt threatens to cancel licences of 8 Discos

Eight electricity distribution companies (Discos) in the country may have their licences revoked by the Federal Government for their failure to meet the remittance threshold as enshrined in the Electric Power Sector Reform Act in July 2019.

The Nigerian Electricity Regulatory Commission (NERC), in a notice to the Discos, gave the names of distribution companies to include Abuja, Benin, Enugu and Ikeja Discos.

Others are Kaduna, Kano, Port Harcourt and Yola Discos.

The notice, posted on its website on Tuesday evening, the power sector regulator said it intended to cancel licences issued to the eight Discos pursuant to Section 74 of the EPSR Act.

According to the notice signed by one of NERC’s commissioners, Dafe Akpeneye, the power firms had 60 days to explain why their licences should not be cancelled.

It said: “Take notice that pursuant to section 74 of the EPSR Act and the terms and conditions of electricity distribution licences issued to the distribution licensees by Nigerian Electricity Regulatory Commission has reasonable cause to believe that the Discos listed below have breached the provisions of EPSRA, terms and conditions of their respective distribution licences and the 2016 – 2018 Minor Review of Multi Year Tariff Order and Minimum Remittance Order for the Year 2019.”

Outlining the Discos concerned, the notice said: “Abuja Electricity Distribution Company Plc; Benin Electricity Distribution Company Plc; Enugu Electricity Distribution Company Plc; Ikeja Electric Plc; Kaduna Electricity Distribution Company Plc; Kano Electricity Distribution Company Plc; Port Harcourt Electricity Distribution Company Plc; and Yola Electricity Distribution Company Plc.”

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Continuing, NERC described the actions of the Discos to be “manifest and flagrant breaches” of EPSRA, terms and conditions of their respective distribution licences and the order.

The commission “therefore requires each of them (Discos) to show cause in writing within 60 days from the date of receipt of this notice as to why their licences should not be cancelled in accordance with section 74 of EPSRA.”

The notice showed that the eight Discos failed to meet the expected remittance threshold for the month of July 2019 billing cycle to the Nigerian Bulk Electricity Trading company.

Three of the Discos remitted 10 per cent during the period, while the highest remittance was 40 per cent, as they all fell short of the expected minimum remittance stipulated by NERC.

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