Distribution Companies (DisCos), yesterday, flayed the Federal Government over what they described as ‘renationalisation’ of electricity firms.
They insisted that government, via the Bureau of Public Enterprise (BPE) and Nigerian Electricity Regulatory Commission (NERC), allegedly has a hand in the failure of the power sector by not “meeting extant guidelines and regulations.”
Association of Nigerian Electricity Distributors (ANED), an umbrella body of the DisCos, in a statement, claimed that government failed to fulfil a N100 billion subsidy and other privatisation promises made since 2013.
At least, five firms – Abuja DisCo, Benin DisCo, Ibadan DisCo, Kaduna and Kano DisCos – have fallen into the hands of banks they took credit from after being unable to break even eight years after licensing.
The prevailing situation, which comes few days after NERC announced a contract-based electricity market, stakeholders said the development might worsen the industry’s woes, pointing to an alleged breach by BPE and NERC.
Executive Director, Research and Advocacy, Sunday Oduntan, said the utility companies are deeply concerned about the “restructuring” of the five electricity distribution firms, adding that the move “is inconsistent with all the guidelines and processes necessary to comply with the framework of privatisation agreements and the rule of law.”
According to him, resultant outcome of the move has been an expropriation or backdoor renationalisation of the DisCos by the Federal Government.
He went on: “Such renationalisation or expropriation must be viewed through a historical context as necessary for a proper understanding of the performance challenges that the DisCos have been faced with since privatisation.
“Fundamentally, the basis of privatisation was flawed from the beginning, due to conditions that were not met by the Federal Government, while expecting the DisCos to meet their performance obligations. Not only were the investors short-changed because of insufficient and unreliable data that was provided by BPE to them during the privatisation process, but the government also committed to and failed to deliver on DisCos’ debt-free financial books, payment of Ministries, Department and Agencies (MDA) electricity debts and N100 billion subsidy.”