License Revocation: NERC quiet on Kaduna DisCo Weeks after 60-day deadline
There are indications that the Nigerian Electricity Regulatory Commission (NERC) may have compromised some sections of its regulations, leading its failure to exercise authority on Kaduna Electricity Distribution Company (KAEDCO), over 30 days after the expiration of its threat to revoke the DisCo’s licence.
The NERC in a published notice issued to media three months ago, raised some exceptions against the DisCo over the incessant irregularities perpetrated to flout some regulatory requirements on its financial obligations to the regulators- the Nigerian Bulk Electricity Trading (NBET) and the Market Operator (MO).
The regulatory body, which spoke through its Commissioner, Legal, Licencing and Compliance, Dafe Akpeneye, on May 15, 2023, justifies its licence revocation threat saying the DisCo was indebted to the tune of N93.42 billion unaccounted energy used.
It, therefore, gave the distribution company 60 days to repay its debt or have its operating licence revoked.
NERC said, “Take note that KAEDCO hereby given 60 days from the date of this notice to show cause why the electricity distribution licence should not be cancelled in accordance with section 74 of EPSRA.”
Meanwhile, over 30 days after the expiration of the 60-day ultimatum by NERC, DisCo still holds an Electricity Distribution Licence (EDL), a legal document that gives it powers to continue to carry out the electricity business in Nigeria.
This implies that the Kanduna DisCo will continue to carry out normal operations in its Licence areas of Kaduna, Kebbi, Zamfara and Sokoto states, in spite of its flagrant breaches of EPSRA and the terms and conditions of its EDL, and outright refusal to SHOW CAUSE in writing within 60 days from the date of receipt of this Notice, in accordance with section 74 of EPSRA.
This impasse and inaction by NERC could give rise to cash collection challenges and deepen the liquidity crisis for the Disco and Nigerian Electricity Supply Industry (NESI) in general.