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The regulator is demanding greater accountability from electricity companies The Nigerian Electricity Regulatory Commission (NERC) has issued a fresh raft of directives to the country’s electricity distribution companies (DisCos) for 2025, while an energy expert lambasted the entities’ 2024 performance as abysmal. In a follow-up to the Order on Performance Monitoring Framework for DisCos on 5 July 2024, NERC issued an Addendum-1, effective 23 December 2024. NERC confirmed the order in a statement on 31 December. The Order seeks to ensure compliance with Key Performance Indicators (KPIs). NERC looks to force DisCos to improve operational output These include accountability by the DisCos’ management, increased operational performance, improved energy delivery to customers, and customer satisfaction. In addition to the performance obligations and customer service guidelines in the earlier Order to the DisCos, Addendum-1 reviewed three of the KPIs as follows: Penalty for default in energy offtake reviewed from one month to two months per quarter: failure to offtake up to 95% of available nominated energy in two out of the three months per quarter attracts a downward adjustment of DisCos’ administrative operational expenditure by 5% for the next quarter. Failure in reporting using the Uniform System of Accounts reviewed from monthly to two months per quarter: failure to meet two months compliance targets attracts enforcement actions including withdrawal of “Fit and Proper” approval of the DisCo’s Chief Finance Officer or its equivalent position. Timeline to comply with complaints resolution through NERC Contact Centre and NERC HQ reviewed from two months compliance target by DisCos. NERC said it now expects a 75% resolution rate for all complaints within a quarter. “NERC shall issue Rectification Directives for all compliance issues for the three affected KPIs for Q3 and Q4 2024. “The updated enforcement framework contained in the Addendum-1 is to be applied from Q1 2025,” the Nigerian regulator said. Energy expert concerned over continued electricity billing issues Meanwhile, Chinedu Bosah, the National Coordinator of the Coalition for Affordable and Regular Electricity (CARE), said the Nigerian electricity sector faces a grim outlook. In an interview with EnviroNews Nigeria this week, Bosah described the performance of DisCos in 2024 as “abysmal.” Bosah said the sector was marked by widespread consumer complaints about erratic power supply and sky-high electricity billing. He criticised the DisCos for prioritising profits over infrastructure investment, which had left the power supply system in disarray. One of the significant issues affecting the sector, according to him, is the pervasive problem of estimated billing. The metering deficit in households across Nigeria Bosah said that approximately 55% of households in Nigeria connected to the national grid, around seven million, still lack meters. “Meters, which should be provided free of charge by the DisCos, have become an expensive commodity due to a profit-driven meter supply mechanism. “This is a clear example of how the privatisation of the sector has turned it into a money-spinning venture at the expense of ordinary Nigerians,” he said. |
