NERC approves close to US$ 2bn for 11 electricity DisCo?s in Nigeria

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The Nigerian Electricity Regulatory Commission (NERC) has approved over US$ 1.9bn for electricity Distribution Companies (DisCo’s) in Nigeria through the Performance Improvement Plan (PIP) and Capital Expenditure Program (CAPEX) that is expected to take effect from July 1, 2021, to June 30, 2026.

Through the PIP and CAPEX initiative, the Discos are expected to commit to the growth parameters, which include the reduction of Aggregate Technical, Commercial and Collection (ATC&C) losses, reliability, and availability of services, billing, and payment processes as well as metering.

Funds approved for each DisCo

According to the information contained in separate orders to the 11 DisCos, the highest fund approval per year (US$ 320.8M) went to Ikeja DisCo followed by Kaduna DisCo (US$ 300M), Eko DisCo (US$ 246.7M), Benin DisCo (US$ 246.1M) and Ibadan DisCo (US$ 239.7M). Others are Abuja DisCo (US$ 207.8M), Port Harcourt DisCo (US$ 198.7M), Enugu DisCo (US$ 177.4), Kano DisCo (US$ 166.1M), Jos DisCo (US$ 124.2m), and Yola DisCo (US$ 71.8M.

Before arriving at these figures, the NERC said that there had been engagements, which were necessary to instill accountability between the Discos and their customers on their services and justification for associated costs and resulting tariffs.

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“The meetings were meant to minimize disputes by engendering understanding and trust between the power distributors and their customers and provide an opportunity to engage with customers on the service improvement investment program,” noted the NERC.

What the funds will help the DisCos to achieve 

For instance, owing to the approved funds, the Abuja Electricity Distribution Company (AEDC) will reduce ATC&C losses from the current level of 45 to 19% over the next five years, achieve 100% metering of customers by installing 698,606 meters over the next three years as well as improve customer safety and reduce inadvertent accidents.

The funds will also enable the AEDC to increase the number of new customers from the current level of 1.214 million to 3.450 million over the five-year period, plus go-ahead to embark on network expansion, rehabilitation, and network upgrade projects.