Boycott DisCos, Buy Electricity Directly From GenCos, Fashola Tells Customers
Babatunde Fashola, Minister of Power, Works and Housing[/caption]
Babatunde Fashola, the Minister of Power, Works and Housing, has on Friday directed select customers to directly buy electricity from Generation Companies (GenCos).
Fashola, while relying on section 27 of the Electric Power Sector Reform Act (EPSRA) 2005, made the declaration in a statement issued by Dr Usman Abba-Arabi, Head of Public Affairs at the Nigerian Electricity Regulatory Commission (NERC).
The minster stated that 2005 EPSRA permits ‘certain’ customers to buy power from GenCos, other than the 11 electricity Distribution Companies (DisCos) currently available in the country.
Advertisement
Fashola said four categories of customers can now buy power directly from GenCos by signing a Distribution Use of System (DUOS) or through the Transmission Use of System (TUoS).
“The new policy directive is expected to bring into play new and stranded generation capacities which may be contracted between GenCos and the customers,” said the minister.
But the DisCos, through the Association of Nigerian Electricity Distributors (ANED), however kicked against this, saying the country’s electricity market was not competitive enough for the new directive.
In their reaction, ANED’s spokesman, Mr Sunday Oduntan, said, “Our understanding is that Eligible Customers may only be declared by the Minister when a competitive market exists in the Nigerian Electricity Supply Industry (NESI).”
Advertisement
The DisCos argued that such competitive market, “currently, does not exist”.
He said the Section 28 of the EPSRA states that DisCos “must be compensated for any reduction in their ability to “earn permitted rates of return on their assets” or any inadequacy in their revenues.”
