Adebayo Adelabu, the Minister of Power, has promised to look into the 11 Distribution Companies, or DisCos, in the nation over their five-year license extension.
During a Wednesday interactive session with journalists, Adelabu revealed this.
According to reports, Nigeria’s deal to privatize its energy industry ended on October 31, 2018, following the start of a 10-month moratorium plan in November 2013.
The agreement had provided for an extra five years as well as a ten-year renewal option, subject to the government’s assessment of the DisCos’ performance.
However, during the first Nigerian Electricity Supply Industry (NESI) conference last week, the Nigerian Electricity Regulatory Commission (NERC) said that the firms had received a 5-year renewal, allaying investor concerns about their money being lost because the industry required long-term commitment.
In response to the news, Adelabu emphasized that performance need to be prioritized before license.
“The vice chairman of NERC informed me that the commission had extended the licenses by an additional five years prior to their tenure. We are currently reviewing the legal and contractual accuracy of this, and I have mandated an inquiry to see if the license extensions were appropriate.
“The performance bond we signed with the private sector operators is more significant than the license.” It doesn’t really matter if the license is renewed for another ten years or not because it can be revoked at any time. If you don’t follow the terms of the performance bond, all I’ll have to do is give you $1, and you can walk away to regain ownership of the license, he stated.
Remember that FG chastised electricity sector operators for their incompetence ten years following privatization.