Nigerian Govt Introduces New Electricity Distribution Policy to Bypass Discos

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(file photo).
4 December 2019

The Federal Ministry of Power's new electricity distribution policy called "Willing Seller, Willing Buyer" was designed to bypass middlemen and sell power directly to consumers, a statement on Wednesday by Aaron Artimas, the Special Adviser (Media and Communications) to the Minister of Power, has said.

Under the differential power distribution policy, electricity will be wheeled directly from the generation companies (GenCos) to willing consumers who are ready to fully settle their bills.

The willing consumers may include community and commercial clusters, industrial areas and hospitality sectors, the statement said.

Speaking on a Freedom Radio phone-in programme in Kano on Tuesday, the Minister of Power, Sale Mamman, said the policy was designed to save energy losses in the sector and assist GenCos who have not been getting the full payment for their generated power.

Mr Mamman said the policy has already taken off as a pilot scheme in two states.

The minister revealed that DisCos have not been distributing all the power wheeled to them on the pretext that the consumers were not paying for power supply.

This, he said, necessitated the huge federal government's subsidy intervention in the power sector by paying the GenCos for undistributed power.

Mr Mamman lamented that last year the Federal government approved an intervention fund of N700 billion to the GenCos and that just recently another N600 billion was approved for the same purpose.

He said this huge subsidy was an overbearing burden on the government, adding that over 2,000MW of electricity was not being distributed due to the failure of the distribution chain.

Mr Mamman also explained that the DisCos were owing the GenCos and other agencies in the sector over N1.3 trillion and that their collection and remittances have remained below 30 per cent despite several efforts to make them improve.

The minister assured that the government was taking various measures, including the completion of on-going power projects to improve generation and distribution and called on Nigerians to be more responsible citizens by paying their electricity bills.

He noted that in the neighbouring Niger Republic, electricity tariffs were higher but payments were almost 100 per cent.

The minister also added that as part of efforts to improve power supply to the North, a new 330kva line would be installed for Kano and other cities to balance distribution in the country.

He, however, hinted that with the anticipated improvement in power supply to the country, the increase in electricity tariffs was inevitable, considering the cost of energy generation in Nigeria.

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