Ikeja Electric has signed Premium Power Purchase Agreement with the Onigbogbo Residents Association to ensure the community access 24 hours daily power supply.
The company tweeted this on Wednesday disclosing that the development is in line with its bilateral agreement.
Premium Power is Ikeja Electric’s offering in line with the Federal Government’s “willing seller, willing buyer” policy. Under this agreement, residents will enjoy up to 24 hours daily supply.
What this means: The Power Purchase Agreement suggests residents of Onigbagbo RA will enjoy a steady power supply when compared to non-residents. However, they will have to pay tariffs much higher than is provided for in MYTO.
Residents in Magodo, who currently enjoy a similar arrangement, informed Nairametrics that they pay higher tariffs but have enjoyed regular power supply and often go days without a power cut.
They also explained that even when the power cuts, they get messages from Ikeja Electric, explaining why the power was cut and indicating when it will return. We understand Ikeja Electric still relies on the grid to deliver this power as such power cuts will still be expected in the transmission and distribution end.
In its previous Power Purchase deal with Ikeja GRA Residents, it stated that, “with the agreement, IE will provide the residents with electricity supply beyond the existing standards, with guaranteed performance levels. In addition, there will also be access to dedicated Customer Care and Technical teams for prompt resolution of queries and/or technical issues within the estate.”
Also, the Chief Operating Officer, IE, Mrs. Folake Soetan expressed confidence in the success of the trend-setting agreement, which she noted was in line with the Federal Government’s willing seller, willing buyer policy.
Backstory: In August, Ikeja Electric announced it signed a similar power purchase agreement with residents of Magodo, providing them power supply of up to 20 hours daily. Residents of Magodo have been enjoying steady power since then and are thought to be paying about N47 per kilowatt-hour of power compared to the MYTO tariff which is N23.10 for residential customers.
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Sources with knowledge of the transaction indicate Ikeja Electric is likely to extend this arrangement to other estates within Lagos, in a move that disrupts the power sector dynamics. Residents in the Eko Franchise area seeking regular power supply have also demanded a similar deal and are ready to pay for a tariff that is higher than the MYTO approved tariff for general customers.
It is however not clear if the Nigerian Electricity Regulatory Commission, NERC has approved this arrangement.