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Time for The Big Stick?

Time for The Big Stick?

Posted By Admin    on 13th Mar 2019   

As it appears, the controversy surrounding an alleged 2,000MW of stranded power isn’t about to end anytime soon. Last week, the Transmission Company of Nigeria (TCN), gave Nigerians another window into the problem, ostensibly in fulfillment of its promise to take reporters to see, first hand, evidence of ‘stranded power’ in the Abuja Electricity Distribution Company (AEDC) franchise area.

Affirming what is generally known about the DisCos’ lack of financial muscle and operational dexterity, the TCN’s Assistant General Manager, Transmission, Abuja Sub-station, Suleman Mahmud, at the end of the tour told journalists that the AEDC currently accepts only about 60% of the load allocated for onward supply to the consumers in its franchise area.

When asked why TCN would not divert the rejected load to other DisCos, his explanation is that the DisCos as a whole “have adopted a common practice known as load management with which they reject 40% of the load that is wheeled to them for distribution to their customers”.

Not too long ago, the TCN Managing Director, Usman Gur Mohammed, had, while seeking to draw attention to that particular weakness in the service delivery chain and its overall implication for the entire industry, spoken on the need for the DisCos to be recapitalised. His argument was that no matter the amount of investment that TCN put into transmission expansion, it cannot achieve the desired result without the DisCos expanding their own capacity to deliver the evacuated power to the end user. And that was long after the minister of of power, Babatunde Fashola, had raised the issue of stranded power in addition to drawing attention to the limited capacity of the DisCos and how this hampers the activities of the other players in the sector.

All the while, the DisCos have been content to dismiss the charge of ‘stranded power’ as fiction; aside treating consumers to the standard fare of how the industry’s non-adoption of a “cost-reflective” tariff is hampering the delivery of services. They have neither shown concrete proof of efforts directed at boosting their operational capabilities nor of decisive steps to address lingering consumer complaints.

To be sure, the TCN has not said anything new. What continues to intrigue is the reluctance of the Federal Government to revisit an exercise so terribly rigged as to undermine the nation’s long term strategic interests and whose paths increasingly leads to nowhere. The DisCos are important, no doubt. Aside their day to day interface with the consumers in service delivery, their activities have direct bearing on the fortunes of the sector as a whole, and particularly in how the sector is perceived by the consumer.

The reality however is that the DisCos have proven to be the weakest in the chain, having neither expanded on their distribution infrastructure nor taken steps to ensure that their consumers get value for every kobo of their money spent. For the country, it continues to be a case of double jeopardy: generated power, though transmitted can’t get to the ultimate user; aside the huge uncollectable revenue.

The only fate worse than the present is to allow the current situation which not only guarantees that the DisCos would be allowed to hold the entire sector hostage, but will ultimately drag the sector into the abyss.

We understand the reluctance of the Nigerian Electricity Regulatory Commission (NERC) to wield the big stick as canvassed in some quarters. To be clear, a blanket regulatory action would seem grossly unfair if only in the context of the modest efforts being undertaken by a few of the DisCos. Considering that the Federal Government holds substantial interests in the DisCos, it should not be difficult for it to sort out the anaemic DisCos from the pack for appropriate regulatory action. It should do so without further delay.

Source: The Nation

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