{"id":42692,"date":"2020-09-01T17:20:53","date_gmt":"2020-09-01T16:20:53","guid":{"rendered":"https:\/\/nationalwire.com.ng\/?p=42692"},"modified":"2020-09-01T17:20:53","modified_gmt":"2020-09-01T16:20:53","slug":"nerc-sets-rules-for-operators-as-new-tariffs-take-off","status":"publish","type":"post","link":"https:\/\/nationalwire.com.ng\/sub\/nerc-sets-rules-for-operators-as-new-tariffs-take-off\/","title":{"rendered":"NERC Sets Rules For Operators As New Tariffs Take Off"},"content":{"rendered":"

\u2022To penalise Discos, TCN for power rejection, under-supply<\/strong><\/p>\n

The Nigerian Electricity Regulatory Commission (NERC) on Tuesday issued guidelines to stop the blame game between the Transmission Company of Nigeria (TCN) and Distribution Companies (Discos) over the latter\u2019s alleged incessant rejection of power.<\/p>\n

The new guidelines came as the revised electricity tariffs to be paid by some electricity consumers, earlier approved by President Muhammadu Buhari and the NERC, commence today.<\/p>\n

Under the guidelines, NERC said that, \u201cthe federal government under the Power Sector Recovery Plan (PSRP) financial plan has committed to funding the revenue gap arising from the difference between the cost reflective tariffs determined by the commission and the actual end-user tariff during the transition to the cost-reflective tariff.\u201d<\/p>\n

In documents containing the official communication between NERC and the Discos, which detailed the reviewed rules, the regulator said any rejection of power by either the Discos or under-supply by the TCN would now attract a \u201ccapacity charge.\u201d<\/p>\n

TCN has always complained that the country\u2019s power supply situation is worsening because of the rejection of electricity allocation by Discos, noting that the problem persisted because the distributors can drop load and increase it at will without being penalised.<\/p>\n

\u201cWhere it is established that the TCN is unable to deliver Discos\u2019 load allocation, TCN shall be liable to pay for associated capacity charge. Where Discos fail to take its entire load allocation due to constraints in its network, the Disco shall be liable to pay capacity charge as allocated in its vesting contracts,\u201d NERC stated.<\/p>\n

The new order instructed the Discos on the modalities for billing customers who fall under different classifications with the commencement of the new tariffs, saying that Nigerians who receive less than 12-hour supply of electricity will not be affected in the latest increase until service improves.<\/p>\n

\u201cThis order shall take effect from September 1, 2020 and shall cease to have an effect on the issuance of a new minor review order or an extraordinary tariff review order by the commission,\u201d NERC stated.<\/p>\n

It said the commission took the decision after it reviewed the application filed by the Discos, taking into consideration the outcome of the public consultations held in February and March and thereafter approved the new tariff regime that will cover from September to June 2025.<\/p>\n

\u201cThe order reflects the impact of changes in macroeconomic parameters and revenue requirements and a revised tariff design that aligns rates paid by customers with the quality of services as measured by the average availability of power over a month period.<\/p>

\r\n
Advertisement<\/div>\r\n\t\t\t\t\t\t\t<\/a>\r\n \r\n\t\t\t\t\t\t\t<\/div>\n

\u201cPursuant to the objective of incentivising a continuous improvement of service for all customers, there shall be no tariff reviews for customers experiencing an average power supply availability of less than 12 hours per day over a period of one month.<\/p>\n

\u201cUnmetered customers within service bands A,B and C thus benefiting from a supply availability in excess of an average of 12 hours per day over a period of one month as affected by this tariff order shall be protected by the provision of order on capping of estimated bills in the NESI and federal government intervention on accelerated metering of all customers.<\/p>\n

\u201cThe commission orders that you shall continue to maintain the lifeline tariff of N4 per kW for all customers consuming less than 50kw per hour of energy per month as a safeguard for the less privileged members of the society,\u201d NERC added.<\/p>\n

On the objectives of the order, NERC noted that it seeks to ensure that prices are fair to customers and sufficient to fully recover the efficient cost of operation, including a reasonable return on capital invested in business by the Discos.<\/p>\n

The power sector regulator said the new guidelines would provide a path to a transition to full service-based cost-reflective tariffs by July 2021 and re-classify as well as disaggregate customer clusters on the basis of commitment to quality of service.<\/p>\n

Upon evaluation, NERC said it considered and approved five tariff service bands representing relative quality of service experience.<\/p>\n

It told the power distributors that it arrived at the new rates after considering the country\u2019s rate of inflation for July 2020 as obtained from the National Bureau of Statistics (NBS), which was 12.82 per cent.<\/p>\n

NERC further pegged the applicable exchange rate of N383.80 and gas price of $2.50\/mmbtu and gas transportation cost of $.80 mmbtu.<\/p>\n

However, it said there would be a \u201ctariff freeze\u201d for customers in bands D, E, directing that they shall be charged tariffs obtainable prior to the take-off of the new rates pending when power improves.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

The Nigerian Electricity Regulatory Commission (NERC) on Tuesday issued guidelines to stop the blame game between the Transmission Company of Nigeria (TCN) and Distribution Companies (Discos) over the latter\u2019s alleged incessant rejection of power.<\/p>\n","protected":false},"author":6,"featured_media":35454,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[17],"tags":[7230],"coauthors":[2391],"class_list":["post-42692","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-news","tag-electricity-tariff-hike-in-nigeria"],"yoast_head":"\nNERC Sets Rules For Operators As New Tariffs Take Off - National Wire<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/nationalwire.com.ng\/sub\/nerc-sets-rules-for-operators-as-new-tariffs-take-off\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"NERC Sets Rules For Operators As New Tariffs Take Off - 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