Underperforming DisCos and GenCos in Nigeria will have their licences revoked- Adelabu

The Federal Government of Nigeria, according to Minister of Power Adebayo Adelabu, would not extend licence agreements for energy distribution and producing businesses that are not functioning up to par.

Adelabu made this revelation on Monday during the three-day inaugural Nigerian Electricity Supply Industry (NESI) Market Participants and Stakeholders Roundtable (NMPSR) opening ceremony in Abuja.

He regretted that operators had not succeeded in meeting their goals ten years after the power sector was privatised in November 2013.

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He insisted that licences of operators who have not performed up to par would be cancelled.

He remarked, “I indicated that the licences are expiring after ten years and that it’s time for renewal. Renewing is not a given. The licence of any privatised enterprises that have not performed up to par will not be renewed. We must ascertain whether you have abided by the guidelines set forth in the licence you were granted.

The majority of nations do not privatise the entire value chain of their power supply, from generation to transmission to distribution, as I indicated in my lecture. Even yet, we have already taken this action; how can we circumvent the present situation in order to accomplish our goals and priorities?

And I stated that it is not a task for a single individual or group of interested parties. There is work for everyone. Each of us has a part to perform.

To emerge strong and succeed in the sector, we must all work together and fulfil our responsibilities.

We will examine the technical capabilities of both the DisCos and the GenCos. We are going to examine the DisCos’ financial capacity. Since obtaining this licence, how much money have you invested? How much of the infrastructure has been improved by you? Which AT&C losses have you decreased in accordance with the terms stated in the licencing agreement? These are the very important talks that we need to be having with the distribution and generating businesses in the private sector.

Obasanjo News24 notes that the power industry, which included six power plants and eleven electrical distribution businesses, was privatised in November 2013.