NERC Issues Order to Sanction DisCos over Non-compliance to Required KPIs
- The Nigerian Electricity Regulatory Commission (NERC) has reeled out several sanctions against DisCos and their management over non-compliance
- The new sanctions could see a DisCo head of customer service losing his KYL as the penalty for not meeting the 75% requirement of complaint resolution
- This is part of the commission's move to keep electricity distribution companies accountable and protect consumers' interest
Legit.ng journalist Ruth Okwumbu-Imafidon has over a decade of experience and a deep understanding of Nigeria's corporate sector and emerging trends in the fintech space.
The Nigerian Electricity Regulatory Commission (NERC) has issued an order to sanction the management of electricity distribution companies (DisCos) for non-compliance with the required Key Performance Indicators (KPIs).
NERC issued an order titled Addendum 1 on Performance Monitoring Framework for Distribution Companies, focusing on ensuring that DisCos deliver on already issued KPIs.
Source: UGC
This recent order, signed by Sanusi Garba, the NERC Chairman, and Dafe Akpeneye, its Commissioner for Legal, Licensing and Compliance, updated the earlier released framework on July 5, 2024, and took effect on December 30, 2024.
Key among these KPIs are improved energy delivery, improved customer complaint resolution, and accountability by the DisCos.
Penalties for non-compliance
Based on the new order, DisCos that fail to offtake up to 95 % of the available nominated energy for at least two or three months in a quarter will be penalised with a 5% reduction of their administrative operational expenditure in the next quarter.
Also, failure to achieve a 75% resolution rate for all customer complaints in a quarter, would see the withdrawal of the KYL of the Head of Customer Service or the officer responsible for resolving customer complaints in the utility.
For non-compliance with the Uniform System of A count (USoA) reporting for up to two months, NERC will withdraw the "Fit and Proper" approval of the DisCo’s Chief Finance Officer or its equivalent position.
About the penalties to be charged, NERC said;
"Penalties to be charged for non-resolutio after expiration of timelines for billing is N10, 000/day; disconnection, N2,000/day; interruption, N2,000/day; metering, N1,000/day; delay in connection, N1,000/day and Voltage, N1,000/day."
Recall that sometime in 2024, NERC penalised eleven DisCos with N10.5 billion for failing to adhere to the regulations concerning the capping of estimated bills for customers without meters.
NERC also urged electricity consumers to report any DisCo that fail to supply necessary equipment, such as cables and transformers.
NERC reviews electricity tariff
In related news, Legit.ng reported that NERC announced a decrease in electricity tariffs in May 2024 in accordance with its responsibility to regulate the industry and protect consumers' rights.
The review came against the backdrop of the naira's appreciation in the preceding month, and it reduced the electricity costs for Band A consumers by 16.03%.
This lowered electricity costs for Band A customers from N225 per KWh to 206.8/KWh.
Proofread by Kola Muhammed, journalist and copyeditor at Legit.ng
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Source: Legit.ng
