A Review of the Nigerian Energy Industry

Benin DISCO: Southern Consortium denies breaching privatisation rules

26 October2012, Sweetcrude, ABUJA – Southern Electricity Distribution Company, SEDC,owned partly by the governments of Edo, Delta, Ondo and Ekiti state governments has denied flouting any rules of the privatisation processas alleged by Mr Atedo Petersuide, chairman, Technical Committee of the National Council on Privatisation, NCP.

SEDC was a bidder for the Benin Electricity Distribution Company, DEDC, that was eventually awarded to Vigeo Consortium by the Bureau of Public Enterprises, BPE.

The company said it submitted one technical and commercial bid, but with two scenarios laying out different capital investment schedules, in compliance with the guidelines.

Chairman, Technical Committee of the National Council on Privatisation (NCP), Mr. Atedo Peterside, had at a press briefing in Lagos on Monday alleged that SEDC submitted multiple commercial bids for the same DISCO, in clear violation of the
He was reacting to claims by governors of Ekiti, Edo and Delta States that the bidding process for the DISCOs, organised by the BPE, was fraudulent and untransparent.

Peterside also said close to 90 per cent of the seven members of the Southern Consortium is owned by private sector companies that are not owned directly or indirectly by the governments of Delta, Edo, Ekiti and Ondo States.

In reply to Peterside in a statement signed by the General Manager, IMS Ltd, Mr. Sayo Akintola, Southern Consortium said it did not at any time submit two different bids. According to him, in compliance with the investment schedule guidelines and the BPE and the NERC directive on metering rollout, the SEDC submitted one technical and commercial bid, but with two scenarios laying out different capital investment schedules.

He explained that the scenarios were clearly laid out in the executive summary, with additional details on pages 52 and 53 of its technical bid (business plan), adding that the technical bid, which was carefully studied and evaluated by the BPE was adjudged first, with a score of 898, without any complaints.

Akintola further clarified that scenario one, was considered the CAPEX to be the same as in the NERC MYTO, which is uniform year-on-year for the five years, while Scenario two, dubbed FAST TRACK, was proposed as an alternative.
“In this model the total CAPEX is still the same as in MYTO, but we offered to inject more capital in the first two years, keeping the total five year CAPEX the same as allowed by MYTO,” he said.

The company, while insisting that it complied with the laid down regulations in the privatisation process, added that the second scenario, as stated in its proposal, would allow it to invest more on strengthening the core network in the first two years and thus enable us reduce the ATC&C losses in the third year, while still keeping the total five year CAPEX the same as MYTO as well as adhering to the NERC metering rollout plan

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  • We urge the NCP and promoters of Southern consortium to come to an amicable settlement of outstanding issues relating to the bid for the Benin Disco.