Home Energy More “Eligible Customers” look to purchase 600 MW of electricity

More “Eligible Customers” look to purchase 600 MW of electricity

More “Eligible Customers” look to purchase 600 MW of electricity

Ugo Amadi

Forty-four customers have shown interest to purchase a total of 600MW from underserved and unserved consumers desirous of becoming Eligible Customers, according to a statement by the Ministry of Power, Works and Housing.

According to the statement, of the 44 customers, 14 have submitted license applications to the Nigerian Electricity Regulatory Commission, NERC, two have fulfilled all NERC’s conditions and are expect to be licensed imminently.

In line with the regulation, the electricity Generation Companies, GenCos, were also urged to more aggressively taking advantage of the Eligible Customers regulation, to sell the power they can generate, of which 2,000MW is now stranded, to customers who need it and are willing and able to pay for it.

The ministry insisted that it would be better to sell than wait for the Nigerian Bulk Electricity Trading, NBET to pay for it or to guarantee it, for which NBET needs support from the Federal Government due to shortfalls in payment by distribution companies.

According to the statement, though the Minister, Babatunde Fashola had issued the policy direction to NERC that gave rise to the regulation in May 2017, and NERC has issued the regulation, none of the interested consumers and their generation company suppliers have been given licenses to buy and sell power as Eligible Customers, encouraging NERC to accelerate and simplify the licensing process.

The statement further directed that the Transmission Company of Nigeria, TCN should continue to support the regulation by making targeted investments in the national grid, as needed to service specific contracts with generation companies and Eligible Customers to transmit the power, with penalties for failure to transmit, adding that TCN could finance such targeted investments with the expected revenue from such bilateral transmission contracts.

Encouraging electricity distribution companies, DisCos to embrace the policy, the statement argued that if the DisCos were satisfying the power supply needs of their consumers of bulk power adequately, such consumers would have no reason to generate the power by themselves or to want to become Eligible Customers, adding that by embracing the regulation, the DisCos could partner with investors and generation companies to build new distribution infrastructure to better serve specific paying customers.

“They can buy power directly from generation companies and contract with TCN to deliver it, and give premium service to selected customers or customer groups”, the Permanent Secretary said adding that in such cases the distribution company must be willing and able to guarantee the payment for the power they buy, “because the shortfalls in payment which characterizes their power purchases from NBET, would not be possible in such bilateral contracts”.

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