NERC Outlines Requirements For Buying Transformers, Meters, And Others

NERC Outlines Requirements For Buying Transformers, Meters, And Others

The National Electricity Regulatory Commission (NERC) has outlined the conditions under which electricity consumers can purchase transformers, meters, poles or any other assets for Electricity Distribution Companies (DisCos).

The power sector regulator said that if a consumer buys any electricity asset, he/she has to sign an agreement with the DisCos stating when and how they will be refunded the cost of the transformer or the purchased asset.

This was disclosed in Abuja by NERC’s Commissioner of Consumer Affairs, Aisha Mahmud, at the 3-day NERC/Abuja Electricity Distribution Company (AEDC) Customer Complaint Resolution Meeting.

Not customers’ responsibility: During the meeting, she clarified that it was not the responsibility of electricity consumers to buy transformers or any other assets for DisCos.

Mahmud added that the agreement should contain a dispute resolution clause and all other items that are expected of a standard agreement.

“It is not the responsibility of the consumers to buy meters, poles or any assets for the DisCos because we have already provided for that in the tariff of the utilities.

• “But under any circumstances that you have to purchase this item and you cannot wait for the DisCos to make that investment, we have made provision for that under our “Investment Regulation.’’

Investment regulation: She, however, added that the commission came up with an “investment regulation” which specifies that if a customer has to purchase a transformer, it has to be done through an agreement. She said:

• “The agreement should contain a dispute resolution clause and all other items that are expected of a standard agreement.
• “What we expect from the DisCo is to use their Internally Generated Revenue (IGR) to buy those assets or rather use shareholders’ investment or borrow from the banks to purchase those assets. In the event that they are not able to buy those assets, customers can come in and they have to be refunded.
• “So what the consumers don’t know is that regulation exists and they go about making all sorts of investment which DisCos say is a donation to them because there is no agreement.’’

Consumers’ rights and obligations: The commissioner also explained that it was part of NERC’s responsibility to educate customers on their rights and obligation regarding the electricity market.

She noted, with dismay, that the commission realised that most consumers do not know about the existence of the regulator.

• “They don’t know their right, they have a lot of rights that they are not aware of. It was our duty to tell them that it is their right to get a meter as Discos are not doing you any favour to issue you a meter.’’

Mahmud said that NERC’s mandate is also to educate the consumers on their responsibilities such as the issue of meters, bypass or tempering with meters.

• “They should know that the Discos are just merely collection agents and the revenue they collect is not entirely their own as they have to pay gas suppliers.
• “Pay the Transmission Company (TCN) and the generation companies so customers should know that once they touch the utilities they are also sub-charging themselves.’’

For the records: The power sector regulator, NERC, has always maintained in its earlier policy statements that electricity consumers are not required to pay directly for meters issued to them under the National Mass Metering Programme (NMMP).

• While it stated that it is the responsibility of the DisCos, NERC, however, noted that consumers may elect to acquire a meter from the Meter Asset Programme (MAP).
• NERC pointed out that the regulatory framework approved by the commission under MAP/NMMP Regulation provides for a refund of the cost of the meter through energy credits to the customer at the time of supply of electricity.

Source: nairametrics