George Etomi & Partners (GEPLAW) recently organised a two-day workshop on “Bilateral Trading In The Power Sector: Structuring Bankable Transactions Within The Eligible Customer Regime”.
The workshop, which was facilitated by experts, drawn from regulatory bodies, consultants and operators within generation companies and distribution companies, addressed amongst other things, the legal and commercial framework for the Eligible Customer regime, Transaction Structuring & Funding,
The discourse centred on Investor Concerns, Project Bankability, Financial Structuring and Stakeholders’ Perspectives on the Regime.
Ahmadu Zubairu, the General Manager of the Legal, Licensing and Compliance department in the Nigerian Electricity Regulatory Commission (NERC), who represented the Commissioner, Dafe Akpeneye was the key facilitator of the workshop.
In his presentation, he highlighted the intent of the Regulator in using the Eligible Customer Regulation as a tool for encouraging investment and participation in the sector. Detailed analysis of the provisions of the Regulation, the current low state of participation, latest developments and challenges encountered in the regime were discussed.
It was noted that the general climate of the power industry had a direct impact on the level of participation within the Eligible Customer regime. It was also agreed that the framework for Competition Transition Charge is vital to securing adequate participation of stakeholders, among other factors.
Other critical developments such as the release of the Franchising Regulation, the NERC Minor Review for cost-reflective tariffs and the agreement between the Nigerian and German governments for investment were cited as reassuring factors to encourage more investment in the sector.
Participants were trained on the dynamics of deal structuring for captive power, funding considerations and sector-specific investor concerns. In addition, stakeholder views were heard from the Generation companies and the Distribution companies regarding the impact of the Regulation on their operations.
It was agreed that the settlement of the existing challenges with the commercial and industrial consumers, which constitute the Eligible Customers, will unlock the potentials of Regulation and attract untapped investments into the sector. The workshop was of utmost benefit to participants and appropriate feedback was given to the Regulator on measures to secure increased participation under the regime.
