Plans are underway for the Nigerian Electricity Regulatory Commission (NERC) to review tariffs that customers pay to the 11 Distribution Companies (Discos) and to also approve a new capital expenditure (capex) for the energy distributors.
The source of discord between the regulator and the DisCos has always been the capital expenditure allowance approved by NERC since the distributors insist that it is too low and has limited their capacity for network expansion.
Going by the Multi Year Tariff Order (MYTO) 2015, the approved average capital expenditure allowance to DisCos remains $12million or roughly N5 billion per DiCco annually.
On the other hand, MYTO, is a framework that guides the pricing of electricity in the country and by the rules is supposed to be adjusted twice a year.
The Nigerian Electricity Regulatory Commission (NERC) says it is concluding the Extraordinary Tariff Review process for the 11 Electricity Distribution Companies (DisCos).
NERC, which is the regulator of Nigeria’s power sector, made this known on Monday in a notice to the general public and industry stakeholders posted on its website.
The commission said the review was pursuant to the provisions of the Electric Power Sector Reform Act (EPSRA).
According to NERC, extraordinary tariff reviews are carried out in instances where industry parameters have changed from those used in the operating tariffs to such an extent that a review is urgently required to maintain the viability of the industry.
By Emmanuel Addeh
The World Bank has said that Nigeriansâ faith in the power sector can only be boosted when they see visible results from ongoing reforms in the country.
The Bankâs Practice Manager, West and Central Africa Energy, Ashish Khanna, who stated this during an interactive session with journalists in Abuja, however stated that the challenge of credibility in the sector was not only a Nigerian problem.
âPeople are really struggling on what to believe in the power sector reforms, although Nigeria is not alone.
âWhat we are seeing internationally is that the trust and credibility often come when there’s a carefully drafted integrated vision for the sector and there are actual delivery of results that people really want to see,â he stated.
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