NERC introduces N25,000 levy on generators

Nigeria generator economy… Sets new guidelines for importation
10 September 2013, Lagos – The Federal Government is set to reap billions of naira from the importation of generating sets, as the Nigeria Electricity Regulatory Commission, NERC, has introduced a N25,000 charge per unit of 100KVA generator imported into the country.

The NERC, in its recently released, ‘Guidelines for obtaining Clearance Certificate for the importation of generating sets and related matters,’ also fixed a charge of N3,500 per unit of between 25kva and 100kva generators imported into the country, while generators between 5kva and 25kva attract a charge of N1,000 per unit.

Other charges are: N250 per unit of between 2.5kva and 5kva, while between 0.45 Kva and 2.5 Kva generators attract a charge of N150 per unit.

The NERC is also charging 10 per cent of the fee paid on the initial certificate for renewal of import licenses.

The significance of this policy becomes enormous, especially when viewed against the backdrop that a couple of years ago, Nigerian businesses spent about N1.8 billion on importation of generators within one week.

This was contained in a data obtained from the Central Bank of Nigeria, CBN, which shows that 15 firms purchased $8.2 million from the CBN in one week to import generators alone.

Also, couple of weeks ago, another report published by a global research firm, GBI Research, projected that the importation of generating sets in Nigeria is expected to grow to about N151.16 billion ($950.7 million) by the year 2020.

According to the research firm, Nigeria, which is the largest market for diesel and gas generating sets in Africa, is forecast to see growth rate of about 8.7 per cent to drive up market volume from N71.55 billion ($450 million) in 2011, to about N151.16 billion ($950.7 million) by 2020.

The research firm expects the growth in the Nigerian generating sets market to be driven by the epileptic power situation in the country going by the current state of generation, transmission and distribution networks, and economic growth in the country.

Importation guidelines
The NERC, in the document obtained on its website, signed by the Chairman/Chief Executive Officer, NERC, Dr. Sam Amadi, said the provisions of the guidelines cover every importation into Nigeria. This includes fully assembled generators and knocked-down parts imported for domestic assembling of electric generating sets or retail as spares.

To qualify for the license to import generators into the country, the NERC said every applicant shall submit annual report of generating sets or knocked down parts imported by them in the last 12 months. The report is expected to show the various capacities and the number sold in each category.

The NERC further stated that the annual report of generating sets imported should be submitted before the end of the first quarter of the following year.

The NERC is also seeking to regulate the noise level of generators in the country, as those with noise level above the stated minimum will not be allowed into the country.

It said: “A certificate may be issued for the importation of generating sets or knocked down parts which comply with the relevant provisions on noise level of 35 decibels, as specified under the National Environmental (Noise Standards and Control) Regulations 2009, issued by the National Environmental Standards and Regulations Enforcement Agency (NESREA), and as amended from time to time.

“Every imported and locally assembled generator shall be fitted with optimizers to reduce environmental pollution arising from incomplete combustion.”

Continuing, the NERC said: “A certificate issued by the Commission under these Guidelines shall be for a period of six months only from the date of issue, provided that where a certificate is not utilized for the importation of generating sets or knocked down parts of generating sets stated therein, such certificate shall lapse.

“A certificate may be renewed for a further period of six months and no more subject to the payment of renewal fees.

A certificate issued by the Commission shall be for the purpose of importation of the generating sets and or knocked down parts listed therein and none other whatsoever.

“An application for renewal of clearance certificate shall be within 30 days after the expiration of the initial clearance Certificate issued.

– Vanguard

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