Article summary
- The federal government plans to disconnect electricity distribution and generation companies over failed remittances.
- 13 electricity companies are affected by this decision, which could lead to blackouts in several locations across the country.
- According to reports, the failure of DisCos to remit services bills is because of debts owed by consumers.
The Federal Government through the Transmission Company of Nigeria (TCN) will disconnect 13 electricity companies from the national grid.
Punch reports that the disconnection plan is because of the failure of the affected companies to make remittances of ancillary services bills. As a result of the planned disconnection, electricity consumers being served by the affected companies may experience blackouts.
The notice of disconnection has been served to the affected electricity companies. The affected electricity companies include:
- Abuja Electricity Distribution Company
- Benin Electricity Distribution Company
- Enugu Electricity Distribution Company
- Ibadan Electricity Distribution Company
- Ikeja Electric
- Jos Electricity Distribution Company
- Kaduna Electric
- Kano Electricity Distribution Company
- Port Harcourt Electricity Distribution Company
- APL Electric Company Aba
- Ajaokuta Steel Company- a special electricity customer.
Meanwhile, the defaulting electricity generating companies are Niger Delta Power Holding Company plants and Paras Energy.
TCN request
The Transmission Company of Nigeria has advised the defaulters to comply with the provisions of the Market Rules with respect to payment of their outstanding invoices, posting of adequate bank guarantees, and forwarding of their active Power Purchase Agreements as the case may be, to the Market Operator.
Nairametrics had earlier reported that data from the National Bureau of Statistics (NBS) showed that revenue collected by distribution companies (DisCos) in Q3 2022 stood at N202.62 billion from N188.41 billion in Q2 2022, showing a rise of 7.54%. On a year-on-year basis, revenue generated rose by 5.56% from N191.95 billion in Q3 2021.
Also, revenue collected by DisCos in Q4 2022 stood at N232.32 billion, compared to N202.62 billion in Q3 2022. On a year-on-year basis, revenue collected rose by 16.02% from N200.23 billion in Q4 2021.
It is important to note that all DisCos recorded higher revenues in the fourth quarter of 2022. However, Kano, Port Harcourt, Yola, Kaduna, and Jos DisCos recorded a minimal rise in revenues during the period highlighted.
- According to the report, the number of electricity customers in Nigeria increased from 10,937,488 in the third quarter to 11,058,265 in the fourth quarter.
What you should know
It was reported that the Ibadan Electricity Distribution Company Managing Director/CEO, Kingsley Achife said the company is unable to meet its financial obligations to the electricity value chain due to poor payment and huge outstanding bills from customers.
Electricity distribution companies will continue to lament poor collection because of their failure to do the right which is metering all their customers. This is the only solution to improve collection reduce costs associated with disconnection and improve efficiency. Let them invest in metering the benefits is overwhelming and long lasting perhaps they benefit more from estimated billings.