The Chairman, House of Representatives Committee on Power, Steel Development and Metallurgy, Mr. Daniel Asuquo, has expressed concern over what he described as the deepening liquidity crisis in Nigeria’s electricity market.
Asuquo, expressed his dismay over the challenges in the sector when he led members of the Committee on an oversight visit to Kaduna electricity distribution company (Disco).
His worries followed the pledge of the committee to support all participants in the electricity market to attain their full potentials.
According to a statement by the Head of Corporate Communications of Kaduna Disco, Mr. Abdulazeez Abdullahi, Asuquo, stated that the committee was worried by the financial challenges of the power Discos.
He said: “The Committee is highly disturbed by the huge financial liabilities against the distribution companies across the country which is adversely affecting the pace of development in the electricity market.”
He, however, charged the Discos to step up their operations and ensure significant improvement in their monthly remittance to the market, adding: “The Discos must build strong partnership and synergy to attract real investment to the industry; that you cannot have without building confidence of investors on the market.”
The lawmaker also lent his voice to repeated calls for the emergence of a full-fledged contract market, saying it, “will enable participants in the market freely enter into fair and competitive contractual agreements among themselves.”
The statement noted that the Managing Director of Kaduna Disco, Mr. Garba Haruna, who was represented by a member of the Technical Team from Tata Power, Delhi-India, Mr. Rahul Kumar, had earlier emphasised the need for a review of the wholesale and retail pricing methodology in the market to allow for more transparency and fairness to all market participants.
Haruna said: “The current practice where wholesale pricing changes almost on monthly basis while retail tariff is frozen is largely responsible for the huge shortfall being experienced in the market today and unless this is addressed quickly, the liquidity crisis in the market will continue to hunt us.”
He further appealed to the Committee to continue to exert necessary pressure on relevant agencies in the sector to offset the huge outstanding electricity bills owed by Ministries, Departments and Agencies (MDAs) of government, especially the military and para-military formations.
Haruna, disclosed that in an effort to ensure that all meters-related complaints by customers of the Disco are addressed promptly, the company recently commissioned its ultra-modern meter laboratory.
The statement indicated that other issues discussed during the one day working visit of the Committee included the eligible customers’ regulation of the Nigerian Electricity Regulatory Commission (NERC); how to bridge the huge existing metering gap in the sector; allegations of load rejection by Discos and other operational challenges affecting Nigeria’s power sector.
Authored By: Chineme Okafor