The Nigerian Electricity Regulation Commission (NERC) on Sunday said Eko Electricity Distribution Company (EKEDC) recorded the highest remittance efficiency of 50.03 per cent in the third quarter of 2019.
The Third Quarter Report was obtained by the News Agency of Nigeria (NAN) in Lagos from the website of NERC, which is the regulator of the industry.
NERC said although Jos and Kaduna DisCos’ settlement rates improved during the third quarter, their remittance rates of 19.43 per cent and 19.53 per cent, respectively, were the lowest during the same period.
It said the individual remittance performance prior to NERC’s enforcement indicates that with the exception of Benin and Port Harcourt DisCos, the DisCos recorded increase in their remittance performance in the third quarter of 2019.
The commission said the challenge of low remittance to the market was still a concern to the Commission as it was one of the main causes of the liquidity crisis facing the Nigerian electricity supply industry.
According to NERC, low remittance adversely affects the ability of Nigerian Bulk Electricity Trading Company to honour its financial obligations to electricity generation companies.
It said service providers such as Market Operators and NERC also struggle with the paucity of funds impacting their capacity to perform their statutory obligations due to the low remittance. The report said: “The commission notes that tariff deficit is partly responsible for poor remittance in the industry
“All the DisCos are being steered continually to rapidly improve on their revenue collection from customers in order to fulfil their remittance obligations and mitigate financial distress in the Nigerian electricity supply industry.
“To address discretionary remittance, the commission issued and continued to enforce the Minimum Remittance Order which stipulates minimum remittance obligation for each DisCo having adjusted for tariff shortfall.
“This order ended the discretionary remittance by DisCos and ensures transparency and equity in the disbursement of market funds for the benefit of all participants in the industry.
“Following the commission’s notice for licence cancellation to DisCos that failed to meet their minimum remittance as stipulated in MRT Order, all DisCos have since met their expected minimum remittance threshold for July, August and September 2019 billing cycles.”
Source: The Sun