Abuja — Lagos State on Wednesday got approval from the Nigerian Electricity Regulating Commission (NERC) to prosecute the Power Holding Company of Nigeria Limited (PHCN) over a N12 billion power purchase agreement.

A NERC tribunal headed by Ransome Owan rejected an application by the PHCN which urged the NERC to disqualify itself from hearing the case.

A petition filed on June 23 last year by Lagos Attorney General and Justice Commissioner, Olasupo Sasore, took the PHCN to the NERC over unlawful deduction of N225 million from the state's monthly allocation and wrongful invoicing of N12 billion by the PHCN on a power purchase deal on which the PHCN reneged.

The PHCN asked the NERC in a counter affidavit filed by its counsel, Juliah Utulu, to disqualify itself for lack of jurisdiction as its responsibility does not include arbitration "but licensing and regulation of electricity in the country. Only the Federal High Court can entertain this case, as it were, based on jurisdiction."

But Owan ruled that the NERC is empowered, among other things, to ensure market efficiency and no abuse of market power.

"The Commission cannot adjudicate in a case of commercial and contractual nature in so far that the commercial and contractual case goes in line with the Act.

"We, having said all these, state that the Commission has jurisdiction to look into the case brought by the Lagos State Government. We resolved that this is not a case in which the Commission would disqualify itself based on jurisdiction which it has," he declared.

Lagos has also appealed to the Supreme Court to restrain telecommunications operators from installing masts indiscriminately in the state, a case it lost at the Court of Appeal.

Companies involved include Multilinks, Starcoms, ITN, VGC, Teledom, MTN, and the Nigerian Communications Commission (NCC).

No date has been fixed for the hearing.