Non-Performance: NERC Orders Immediate Downgrade of Band A Feeders

By Modupe Gbadeyanka

Any electricity customers on the Band A feeders not supplied at least 20 hours of power supply daily for seven days should be downgraded immediately by the distribution company (DisCo) in the coverage area, the Nigerian Electricity Regulatory Commission (NERC) has directed.

The sector regulator recently approved an increase in the tariff of Band A feeders across the country to N225 per kilowatt hour from N68/kwh on the condition that electricity must be supplied at least 20 hours per day.

This action sparked reactions but NERC said it was the best thing to do to attract investments in the industry, which has been struggling for many years despite being privatised.

In a recent circular, the agency said, “Where the Disco fails to meet the committed service level to a Band A feeder for seven consecutive days, the feeder shall be automatically downgraded to the recorded level of supply per the applicable framework.”

It explained that this is to protect energy consumers in the country in a bid to ensure they get value for their money.

“We wish to assure all Nigerians that the commission, working in collaboration with the policymakers, remains committed to providing adequate and reliable electricity to all citizens as we work diligently with state governments to deliver on the gains of the Electricity Act 2023,” NERC stated.

It further stated that where the Disco fails to deliver on the committed level of service on a Band A feeder for two consecutive days, the distribution firm must publish on its website by 10 am the next day an explanation of the reasons for the failure and update the affected customers on the timeline for restoration of service to the committed service level.

It was gathered that the new tariff hike was implemented after looking into the 12 per cent rise in inflation rate from 28.2 per cent in January 2024 to 31.712 by March 2024.

In addition, a 59 per cent jump in the exchange rate from N919.39/$1 to N1,463.30/$1, 63 per cent increase in generation cost from N63.8 per kilowatt hour to N103.9/kWh, a 34 per cent surge in transmission and admin costs from N6.8/kwh to 9.1/kwh, and 11 per cent rise in gas price from $2.18/MMBTU to $2.42/MMBTU.