NERC to FG: Pay N50bn electricity subsidy arrears

Sam-Amadi, NERC24 August 2014, Abuja – Chairman of the Nigerian Electricity Regulatory Commission (NERC), Dr Sam Amadi, yesterday advised the federal government to fulfill its commitment to the Nigerian Electricity Supply Industry by paying the subsidy arrear of N50billion.

He told The Nation that although consumers have met their part of the obligation, government remains the reneging partner.

The arrear, if paid, he said “will reduce the great impact of the review going forward” ahead of the announcement of the outcome on the Multi-Year Tariff Order review in December.

He also added that the subsidy “can help to take away some of the shortfalls and improve the financial viability of this electricity market.”

According to him, the electricity subsidy fund was supposed to run-off by June but government reneged on its commitment resulting in a backlog debt now up to the tune of N50b arrear.

“So government ought to pay for what it is committed to so that it can help to take away some of the shortfalls and improve the financial viability of this electricity market,” Amadi submitted.

He, however, revealed that the NERC is not relying solely on the subsidy arrear, stating there are alternative plans to keep the electricity market solvent.

“We are also putting out contingent plans assuming government does not pay the arrears so that we must keep the electricity market solvent and strong with or without the subsidy,” he stated.

On why the Electricity Distribution Companies (DISCOs) have been reluctant to make metres available to customers, Amadi said that some of the companies have since November recorded significant metering while others are yet to act.

According to him, the companies may not have done much in terms of metering since they are waiting for the declaration of Transition Electricity Market (TEM) and tariff review.

The chairman said that the commission recorded significant improvement in the remittances which the DISCOs made to Market Operators from May to June.

He revealed that NERC has decided that Eko Electricity Distribution Company that has achieved 98% remittance should have a new benchmark.


– The Nation

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