Lagos — Starting from the 25th of this month, the Nigerian Electricity Regulatory Committee, NERC has said it would hold hearings for the 11 electricity distribution companies, DisCos including the Transmission Company of Nigeria, TCN on electricity tariff review.
In a memo published by the regulator, it said it had constituted hearing panels to the effect.
NERC said the hearing became necessary after the Discos and TCN wrote various letters asking for tariff reviews.
The hearings are expected to round off by March 11.
The Multi Year Tariff Order, MYTO provides a path for the electricity industry, with biannual minor reviews to take into account the impact of changes in a limited number of parameters (specifically inflation, US Dollar exchange rate to naira, natural gas and available generation capacity), and major reviews every 5 years, when all other value chain inputs are reviewed with stakeholders.
Section 9 of the Regulatory on Procedures for Electricity Tariff Review in the Nigerian Electricity Supply Industry, NESI, allows for extraordinary tariff review in instances where the utilities can demonstrate that industry parameters have changed from those used in the operating tariffs to such an extent that a review is required urgently in order to maintain industry viability.
NERC said the DisCos have submitted performance plans covering the period of 2020-2024 in which they made a case for new capital expenditure allowances over and above the provision in the subsisting MYTO 2015.
The justification given by the DisCos for the tariff review, NERC said includes the need to embark on a more aggressive loss reduction, improvement of customers’ services and the deployment of state-of-the-art technology to improve service delivery.