NEC orders forensic audit of power distribution firms

Drastic measures have been taken by the National Economic Council (NEC) to avert the drift in the power sector and the exploitation of Nigerians by the 11 electricity distribution companies (DisCos) in Nigeria.

After an extensive review of the activities of the power firms and the growing complaints of the citizens on the companies’ epileptic services, NEC directed an immediate forensic audit on them.

NEC, which is chaired by the vice president, Prof Yemi Osinbajo, comprises state governors and top officials of the federal government.

After the council’s meeting at the Presidential Villa in Abuja, yesterday, the deputy governor of Edo State, Phillip Shuaibu, told State House correspondents that state governors were asked to provide details of their investments in the DisCos.

The NEC action came two days after the Nigeria Electricity Distribution Company (NERC) put on hold the hike in electricity tariff slated for April 1, 2020. The commission gave the DisCos two years to complete the metering of their customers before considering any increase in electricity charges.

NERC accused the DisCos of frustrating its efforts at ensuring that electricity consumers were metered to end the current regime of estimated billing.

According to Shuaibu, “NEC also receives an update on the review of the status of ownership structure of electricity power distributing companies. The Kaduna State governor, Nasir el-Rufai briefed NEC on the progress made and the responses so far received from the general public.

“He (el-Rufai) also told NEC that there will be a forensic audit of all bank accounts of the DisCos and that state governments will provide the details of their investment in the DisCos. The committee also sought the approval of NEC for another two months to complete its report,” Shuaibu said.

Similalrly, Ebonyi State governor, Dave Umahi, said that the performance of the DisCos was appaling.

He said: “Of course, nobody is happy with the DisCos’ performance and we have a committee chaired by the governor of Kaduna State and they have done a very beautiful job.

“They have placed advertisements in about five newspapers and have asked the general public to give them information on the performance of these DisCos’ and the investments made by private individuals and other stakeholders.

“The governors are requested to before the end of March to submit all their investments from 2013 to date in the DisCos, so that we will get it all together.

“I think the federal government is trying to take the bull by the horn by trying to find out the level of investments theDisCos made towards this privatisation. The first suspicion is that they have made no substantial investment and we will take care of that when we get all the solutions,” Umahi said.

The governor also explained why the Excess Crude Account (ECA) dropped from $325 million to $71 million.

He dismissed insinuations in some quarters that the governors were protesting the sudden drop in the ECA.

Governor Umahi said that $250 million was an agreed investment by the governors and federal government on the National Sovereign Investment Authority (NSIA).

He stated “on the question of ECA $325 million depletin to $71 million and what happens to the $254 million, I will combine it with the question that governors were protesting the depletion and that they were not consulted.

“First, it is not true. $250 million was an agreed investment by governors and federal government on NSIA – National Sovereign Investment Authority and they are doing very well.

“They are handling our infrastructure so nicely that it was further agreed that we should reinvest into it. When these investments are made, the federal, state and local governments all get their investment certificates. So, we are together in this.

“You also asked where is the other $4 million; it was used in paying consultancy fees and for other services that would have caused the fund about $500 million, it was renegotiated to $4 million because, some people went to court over certain transactions in the Nigerian National Petroleum Corporation (NNPC) and so the federal government had to engage a consultant to handle that.

“We would have paid the consultant five per cent of the cost that they were seeking and it would have translated to $500 million. So, if you add $250 million to $4 million, you will get $254 million and if you add $71 million, you will have $325 million. We are back to where we were; so no money is missing,” Umahi clarified.

On the budget support to the states, the governor said that NEC was informed that during the months of January and February 2020, deductions were made from the statutory allocations of the affected states.

On how much was deducted and what was left, he said that “I’m not sure Lagos State took any budget support facility but each state is renegotiating and every month we are now paying N152 million towards that.”

 

Source: Leadership

Share

SUBSCRIBE TO LATEST ENERGY NEWS

Read the latest energy industry news and researched articles
for oil and gas, power generation, renewable energy, events and more...