Eligible Customers: DISCOs, TCN, GENCOs Disagree Over Implementation

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Stakeholders in Nigeria’s power sector have disagreed over the implementation of the Federal Government’s eligible customers policy targeted at supplying power directly to consumers nationwide.

The government had emerged with the eligible customers policy to enable Electricity Generation Companies, GENCOs, generate and deliver electricity directly to consumers.

But some Electricity Distribution Companies, DISCOs, that preferred not to be named, disclosed in separate interviews that it would culminate in the taking over of their core function.

They noted that the DISCOs have a responsibility to distribute power to consumers in all parts of the nation.

The Transmission Company of Nigeria, TCN, also indicated that the proposed arrangement would not likely work as consumers were located in different parts of the nation.

General Manager, TCN, Lagos, Bede Opara, said in a telephone interview that the plan might not be easy to implement.

He said: “It’s very big companies that can afford to buy it. The logistics of making that to happen is not that easy. If you consider a generating plant that is in Port Harcourt, and maybe a private company wants to buy directly from them in Lagos, it must have to pass through transmission network, as they cannot build their network from there straight to Lagos.

“Now, who collects the money and who pays to who?  For companies that are located close to where the generating stations are, that one is easier to achieve, without going through TCN.  Every other that is  not close to the GENCOs must have to pass through TCN.

‘’The issue of revenue colection, and how to pay all the people that are stakeholders on the line up are issues that have to be harmonised before it can work well.

“It can work but we need to put in place all essential factors required for operations. It happens in developed countries. But it is like we are not yet ready to make it work in Nigeria,” he added.

However, Power Generation Companies, GENCOs, said, yesterday, that the declaration of eligible customers in power sector was a brilliant way to liberate the sector from the current monopoly by some under-performing companies.

The GENCOs, operating under the aegis of Association of Power Generation Companies, APGC, said during a media briefing in Abuja,  by its Executive Secretary, Dr. joy Ogaji, that they were waiting desperately to sell more power to end users willing to buy for residential, commercial and industrial use.

Referring to seemingly under performance by Distribution Companies, DISCOs, Ogaji declared that no sector could hold GENCOs to ransom.

Ogaji said: “Over three years after privatisation, the 11 distribution companies have enjoyed the monopoly of bulk power purchase and are still unable to distribute and account properly for power purchased and distributed.”

“The declaration will send a powerful signal that the electricity sector is evolving towards full retail competition which will also ensure a reduction of financial risk by supplying power to worthy eligible consumers.

“The declaration came after government’s assessment of the market status and as an answer to the clarion call through pressures from consumers due to the inability of the Distribution Companies, DISCOs, to fulfil their obligations and the need to promote retail competition in the market.

“With stranded generation capacity in the electricity market and poor market liquidity, declaration of eligible customer is the brilliant way to liberate the electricity sector from the current monopoly by some under-performing companies.”

“This policy directive will lead to increased energy generated/available and expanded generation capacity as GENCOs would potentially ramp up their generation capacities to provide supply to eligible customers, addressing issues bothering on financial viability of the electricity supply value chain, the main and immediate issue confronting Nigerians from enjoying the benefits of the Power Sector Reforms.”

Source: Nigeria Today

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