Electricity distribution companies (DisCos) have abandoned N72 billion investment from the Transmission Company of Nigeria (TCN) in distribution networks, without referring to the Drives operating the networks.
In a statement on Sunday, the Association of Nigerian Electricity Distributors (ANED) fears that customers can bear the cost of unsolicited and erroneous investments, because, as they said, government TCNs do not have the opportunity to invest in a privately owned power grid.
"To ensure that consumers of electricity do not excessively incur the cost of inefficiency of electricity, procurement must be implemented effectively and on a" profitable basis, "noted in it.
The Managing Director of the Transmission Company of Nigeria (TCN), Mr. Usman Gur Mohammed, recently said that TCN is no longer the weakest link in the energy cost chain and that the federal government sent it to invest N72bn in the DisCos network to improve power distribution.
But DisCos stated that the investor's obligation and business is access to debt financing for any such investments, the release of public funds from other urgent social investments.
It said: "Given the rigidly regulated nature of the distribution subsector and that these planned costs do not meet the requirements of the legislation / regulatory requirement that capital investments should be restored through a tariff, failure to comply with this requirement will cause the problem of the lack of recovery of N72 billion."
This initiative creates the potential for a return to the old days of the government, trying to implement projects for which it does not fit.
They noted that instead of the government interfering in reducing the market deficit of N1.3 trillion in the energy sector, investments in N72bn TCN aimed at evacuating the non-existent 2000 megawatts (MW) would further enhance the debt profile.
"We believe that N72 billion should be aimed at filling the tariff gap, providing a commercial basis that will ensure that Nigerian consumers of electricity receive benefits from increased and stable capacity," DisCos said.