NERC to Sanction Discos over Operational Non-accountability

Chineme Okafor in Abuja

The Nigerian Electricity Regulatory Commission (NERC) has disclosed its intention to sanction electricity distribution companies (Discos) that have fallen short of its demand for transparent and accountable management of their networks by failing to submit their updated year-end audited financial reports.

NERC said it had instituted various degrees of enforcement actions against some of the Discos that failed to comply with its request that they file their audited year-end financial reports within a specified timeframe.

It said the decision of the Discos to sidestep its orders to them on this was a clear breach of its regulatory powers, and that it will wield the big stick against them.

According to the acting Chairman of NERC, Dr. Anthony Akah, the commission opted to take punitive actions against the Discos after it discovered that some of them were unwilling to file their audited financial reports, or even filed in formats that were inconsistent with agreed reporting standards.

Akah said during a briefing in Abuja that he could not disclose the identity of the Discos that have filed their reports or those that have not filed.

He however stated that the situation was not particularly pleasing and that the commission was going ahead to fine them for such breach of its regulatory order.

“I don’t have the situation report here but not all distribution companies have submitted their audited financial statements but I want to let you know that the commission has triggered an enforcement process against these distribution companies,” Akah said in response to a question what the reporting status was.

He further said: “Where we are not fully satisfied, we will impose the necessary sanctions as allowed by the law because not all the Disco have submitted. Some submitted partially, some submitted not certified reports and we have in line with our processes written to them notice of enforcement and given them time to reply and thereafter take adequate necessary action.”

Recently, NERC and operators in the sector had at the monthly meeting convened by the Minister of Power, Works and Housing, Babatunde Fashola, agreed on a reporting timeline for their audited year-end financial reports.

Akah also stated that NERC as presently constituted has the power to issue licenses for the construction of about 1000 megawatts (MW) solar power plants which the Nigerian Bulk electricity Trading Company (NBET) signed power purchase agreements with their promoters.

He said on this: “The commission has the ample power to issue licenses as constituted. We don’t have the powers to issue final orders but the EPSR clearly stated in some of its clauses that the commission can delegate some of its responsibilities to its staff to undertake and it is deemed to have been done by the commission.

“It further stated that no acts of the commission can be considered to be invalid on the basis that there is vacancy, clearly there are ample powers available in the commission to issue these licenses.”