NERC Orders MO to Invoke Rules as Niger, Benin, Togo Fail to Remit N21.3bn Tariffs in Q1

.23 die from power-related accidents in three months

Emmanuel Addeh in Abuja

The Nigerian Electricity Regulatory Commission (NERC) has ordered the electricity Market Operator (MO) in Nigeria’s power sector to activate the relevant market rules to ensure the payment of $14.2 million (about N21.3 billion) owed Nigeria by international customers in Q1, 2024.

In its just-released Q1, 2024 report, the power sector regulator stressed that none of the countries being supplied electricity by Nigeria remitted monies to the country during the period under review.

The MO administers the market rules of the Nigerian Electricity Supply Industry (NESI) and is therefore responsible for the administration of the electricity market and promoting efficiency in the market.

The countries involved include: Niger Republic, through its power generation and transmission utility, NIGELEC; Benin Republic through Société Béninoise d’Energie Electrique (SBEE)and Togo through its power utility firm, the Togo Electric Energy Company (CEET).

“None of the four international bilateral customers being supplied by Generation Companies (Gencos) in the NESI made payment against the cumulative invoice of $14.19 million issued by the MO for services rendered in 2024/Q1.

“As indicated in previous reports, the commission expects the MO to invoke the provision of the market rules to curtail the payment indiscipline being exhibited by local and international bilateral customers,” the new NERC report stated.

However, NERC stated that during the period, some bilateral customers (both local and international) made payments for outstanding MO invoices from previous quarters.

It stated that cumulatively, a total of $5.96 million was paid by two international customers from the backlog of debts.

Also, within the country, the report stressed that no remittances were made by bilateral customers against the cumulative invoice of N1.86 billion issued to them by the MO for services rendered in 2024/Q1.

But it noted that the MO received N505.71 million from eight local bilateral customers as payment towards debts that were incurred pre- 2024/Q1.

“The special customer (Ajaokuta Steel Co. Ltd and the host community) did not make any payment towards the N1.27 billion Nigerian Bulk Electricity Trading (NBET) and N0.09 billion (MO) invoices received in 2024/Q1.

“This continues a longstanding trend of non-payment by this customer and the commission has communicated the need for intervention on this issue to the relevant federal government authorities. A continuation of the non-payment may trigger total disconnection from the grid,” it added.

Before now, the federal government in attempting to defend the decision to supply power to neighbouring countries said it was for strategic reasons.

Erstwhile Managing Director of NBET, Dr Nnaemeka Ewelukwa, for instance, one of the issues was the one if Nigeria does not provide electricity to countries that are upstream on the river, they can also build their dams which will create a major crisis for Nigeria.

At the time, Ewelukwa said about 6 per cent of the electricity generated in the country was sold to neighbouring countries. However, the sale of power by some Gencos, it was also learnt, was to boost the dollar-denominated portion of their revenues.

Also, the NERC report stated that 23 persons died in electricity-related incidents in Q1, in 55 accidents, while 31 persons were injured in the first three months of this year.

In 2024/Q1, out of the 99 mandatory health and safety reports expected to be received from licensees, NERC said that only 82 reports were received. It listed licensees with outstanding reports as of Q1 as Gencos: Transafam Power (Afam IV-V), Mabon (Dadin Kowa), Egbin Power (Egbin), First Independent Power Limited (Eleme & Trans Amadi), Paras Energy (Paras), and Shell (Afam VI).

For Discos, NERC listed Abuja, Eko, Ikeja, Jos, Kano, Yola, and the Nigeria Electricity Supply Corporation Limited (NESCO) as those that had yet to send in some reports at the time of preparing the report, while for transmission, the System Operator (SO) and Transmission Service Provider (TSP) had yet to comply.

“The commission will continue to enforce 100 per cent reporting compliance by licensees as contained in the terms and conditions of their respective licences, and apply sanctions where applicable,” the Sanusi Garba-led organisation stated.

However, relative to 2023/Q4, the safety performance within the NESI, NERC said, improved with the number of fatalities decreasing significantly by 36.11 per cent, that is from 36 to 23, while the number of accidents and injuries increased marginally, that is +1.85 per cent and +3.33 per cent respectively.

“During the quarter, NESCO and Yola were the only Discos that did not record any casualties while Egbin was the only Genco with a safety accident.

“Out of the 54 casualties reported in the quarter, the licensees with the highest number of casualties were Eko (13), Benin (eight), Jos (six) and Aba (six) which represented 24.07 per cent, 14.81 per cent, 11.11 per cent and 11.11 per cent respectively.

“Cumulatively, Discos accounted for 96.30 per cent of causalities recorded in 2024/Q1 continuing a trend observed in previous quarters (98.48 per cent in 2023/Q4) that the distribution segment is the biggest contributor to safety issues experienced in the NESI,” the commission said.

The details of the accidents showed that causes included wire snaps: Six deaths and six injuries; illegal/unauthorised access: five deaths and two injuries; acts of vandalism: two deaths and five injuries; unsafe acts/conditions: 10 deaths and 12 injuries while falls from heights accounted for two injuries.

“The commission has initiated investigations into all reported accidents and will enforce appropriate actions against licensees where necessary. Furthermore, the Commission continues to closely monitor the implementation of licensees’ accident reduction strategy for the NESI while the sector’s health and safety code is undergoing a review process,” NERC stated.