MicCom Boss Calls for Collaboration between Stakeholders to Resolve Tariff Deficit Issues in Nigeria
By Eyo Nsima
The Aggregate Technical, Commercial & Collection losses in the Nigerian power sector stood at 50.01 percent in the second quarter of 2021, about 30 percent higher than the Expected Industry Average of 22.11 percent, according to the Nigerian Electricity Regulatory Commission (NERC) report.
To address ATC & C losses, the Chief Operating Officer of MicCom Cables & Wires, Bukola Adubi, has proposed cooperation between stakeholders to resolve the tariff deficit in the sector.
Speaking with The Daily, www.thedaily-ng.com on the margins of the 2022 Nigeria Oil and Gas Conference and Exhibition, which was held in Abuja with the theme, “Funding the Nigerian Energy Mix for Sustainable Economic Growth,” Adubi said that metering requires significant state and Federal Government intervention, adding that the Distribution Companies (DisCos) need to increase capital investment into the distribution network infrastructure.
To achieve the goals of the Presidential Power Initiative, she noted that there is a need for the decentralization of distribution to effectively curtail the DisCos monopoly as well as the exploration of sustainable green power alternatives to shield against global fossil fuel prices hikes and gas production shortfalls.
According to Adubi, allowing states to develop a localized regulatory framework, will improve efficiency and transparency, and ensure the complete removal of electricity from the exclusive list.
Other steps include ensuring stability in policymaking to incentivize investments and relaxing local content requirements to allow the entrance of substantial foreign expertise to increase private sector participation.
In its quest to resolve the multilayered problems in the power sector, Nigeria is exploring a legal and fiscal framework that can work.
Adubi said that the proposed Electricity Bill, currently before the National Assembly, will have an impact on the dilution of the Minister’s powers in sector oversight, and retention of exclusive franchise areas for DisCos.
She commended current steps being taken to close the metering gap such as intervention from states; Central Bank of Nigeria (CBN) intervention; provision of partial risk guarantees to IPPs; capping of estimated billing to control tariff deficits; and franchising of metering, billing and collection process by DisCos.
