An investigation into the five-year license extension for power distribution businesses following the expiration of their initial ten-year license from 2013 to 2023 has been authorized by Nigeria’s Minister of Power, Adebayo Adelabu.
He said: “When I came in, the licenses I saw were for 10 years, 2013 to 2023. But along the line I spoke to the Nigerian Electricity Regulatory Commission, NERC Chairman, and he said, the licenses have been extended for another five years.”
“We are trying to review the correctness of that. We have ordered an investigation into the extension of the licenses if they are actually in order,”
The minister went on to say that although it could be challenging for the federal government to examine the agreements with power distribution firms, it is trying to develop mini discos for each state in the union to ensure that customer requirements are adequately met.
Furthermore, by taking a more proactive stance and making investments in the electricity industry through the DISCOs, he urged state governments to aggressively engage and collaborate with the Distribution Companies (DISCOs) inside their respective states.
In order to determine the best ways to progress the industry, the Minister further underlined that the Ministry would hold talks with the DISCOs. He added that: “It is not politically expedient and reasonable to implement a tariff that is doubling the existing tariff because part of the reason for an escalated tariff is because the cost of gas today is still done in dollars and today 75 to 80% of our power generation comes from gas power when there is an upward movement in exchange rate it affects the tariff.”
