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Although certain conditions make their job quite challenging, the country’s Electricity Distribution Companies, DISCOs, are now devising new ways to make electricity more available and, in the long run, improve their business prospects.
Investigations reveal that government indebtedness is one of the issues the DISCOs have to grapple with. For instance, federal government ministries, departments, and agencies, or MDAs, owe the DISCOs up to 100billion naira.
Another problem facing the private electricity companies is the imbalance caused by the tariff system, which the government setfor DISCOs in February 2016. The Nigerian Electricity Regulation Commission (NERC) fixed the maximum charges at N28.05/KW, whereas the price point at which the DISCOs claim they can operate effectively is about N54/KW.
“This has created a tremendous shortfall in the system; it’s up to 500billion naira” said a DISCO executive in northern Nigeria who declined to be named for this report. “If the regulators don’t do something urgently about the situation, they may cause a reversal of the progress made so far,” he said.
In the meantime, some distribution companies say they are thinking creatively so as to increase power supply to their districts. Better services, they reckon, should boost customer confidence and show government that the DISCOs are playing their part to help advance the economy through the supply of electricity to businesses and residences.
Eko Electricity Distribution Company’s programmes, for instance, include the two direct partnerships it signed for generating power directly. At the moment, this bilateral arrangement generates 140MW of embedded power, which Eko DISCO distributes directly to its customers.
The agreement with Egbin Power Plc generates 100MW while the one with Paras Energy & Natural Resources Development Limited, an international corporation with a plant in Nigeria, generates an additional 40MW.
Sources inside Eko DISCO confirm that the company plans to create more opportunities for embedded energy, which is in line with the approach of the federal ministry of power on incremental power. Already, some of the residents and business owners in its coverage areas are quite impressed with the service they are receiving from the distribution company.
According to a report by Channels TV, residents of Ajah, Lekki, VGC, Banana Island, and nearby neighbourhoods currently see as much as 20 hours of electricity supply every day.
An official of Eko DISCO said the ultimate goal is to have 24-hour power supply for all their customers.
