FG, DisCos focused on solving power supply challenges – ANED

A statement by the Executive Director, Research & Advocacy of ANED,  Sunday Oduntan also dismissed a claim in a section of the media that the federal government will pay N736 billion to investors to repossess the DisCos.

He quoted the media report published on August 14, 2019 as suggesting that the Federal Government is seriously contemplating repossessing some or all of the electricity distribution companies as a “solution” to resolving the power supply problem in the country.

The article referenced a purported document from the Ministry of Power, Works and Housing.

Oduntan who identified efforts at resetting the power sector said, “The federal government and the DisCo investors remain committed to working in partnership to address the current challenges of retail electricity distribution, as evidenced by the recent Siemens initiative and recent regulatory activities.”

He said other efforts that prove the collaboration of DisCos and the government include the ongoing Meter Asset Providers (MAP) programme, the distribution franchise consultations, the present wrap-up of the minor electricity tariff reviews, among others to provide affordable and consistent power supply for electricity customers.

“It is the hope and expectation of the DisCo investors and operators that, collectively, the aforementioned initiatives and activities, in tandem with respect for sanctity of contract, increased regulatory and policy certainty, will provide the enabling environment that will result in a Nigerian Electricity Supply Industry (NESI) that is commercially viable and sustainable, thereby attracting the desperately needed investment that continues to be elusive in the sector,” he noted.

Reacting to the media report on government trying to pay N736bn to investors to repossess the DisCos, ANED described the headline as sensational.  It said the report itself clarified that: “To do so within the provisions of the Share Sale Agreement will require a sum in the region of $2.4bn (about N736bn), some of which will be paid as compensation to the failed investors.

“This is not a desirable outcome. It is noteworthy that government is yet to pay the investor in Yola DisCo for its negotiated return to government,” ruling out the possibility of such a renationalization.

Oduntan said, there are doubts about the document on which the media report was based on adding that such sensationalism could scare future investors from the economy.

“We are troubled that a sector that is already bedeviled with multiple challenges now has to deal with sensationalist and irresponsible journalism rather than an informed discussion of how we can move the sector forward,” he noted.