Power Discos Fight Back, Ask NERC Not to Gag Them

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Babatunde Raji Fashola

Chineme Okafor in Abuja

Power distribution companies (Discos) in Nigeria have asked the Nigerian Electricity Regulatory Commission (NERC) to focus on solving the challenges of the country’s power sector and not get busy with efforts to gag them from speaking out on issues that affect their operations.

Responding to a recent order to them by the NERC to restrain their umbrella association-the Association of Nigerian Electricity Distributors (ANED)-from speaking on policy statements or actions made by it or the Minister of Power, Works and Housing, Mr. Babatunde Fashola, the Discos said their rights to associate are protected by Section 40 of the country’s constitution.

NERC had in a communique issued after a meeting with the Discos in August said ANED’s activities would no longer be tolerated by it, and that the association should no longer interfere with policy directives or regulatory pronouncements made by it or Fashola.

It equally barred ANED from making any unwarranted remark against Fashola and its commissioners.

But in a statement signed by ANED’s Chief Executive Officer, Azu Obiaya, and sent to THISDAY yesterday in Abuja, the Discos indicated ANED was a legal association set up to protect their interests just like other associations in the country’s power sector.

According to them, ANED’s activities were supported by Section 40 of the 1999 Constitution of the Federal Republic of Nigeria under the right of association, adding that ANED represented them with a principal mandate of advocacy to protect the interests of member companies directly and indirectly, the incomes of a 22,000 of their workforce.

“The Discos, with their formation of, and membership of ANED, are exercising this right no different from similar entities along the Nigerian Electricity Supply Industry (NESI) value chain, such as the Association of Power Generating Companies (APGC), Nigerian Gas Association (NGA), National Union of Electricity Employees (NUEE),the investors who have sunk more than $1.4 billion in the acquisition and operations of the Discos till date, and our customers who seek to enjoy the benefits of the best practices that result from the interaction of our members under the ANED umbrella,” the statement noted.

The statement also stated that ANED’s expression or promotion of viewpoints that are contrary to that of an established regulation or policy should not be misunderstood as interference, particularly in the context of the workings of an industry with multiple stakeholder interests.

They noted the need for the NERC to address the widening tariff gap that has reportedly kept them from performing their obligations to the sector.

According to them, NERC’s freezing of residential tariff classes in 2015 for 18 months; removal of collection losses from the tariff in 2015 and non-implementation of five tariff reviews were responsible for the gap.

Discos further asked the NERC to focus its regulatory job on resolving the sector’s N435.7 billion under-recovered revenue.