NERC Commences Fresh Review Of Electricity Tariff For TCN, 11 DisCos

The Nigerian Electricity Regulatory Commission, NERC, has issued a notice on its intent to start a fresh extraordinary tariff review for the Transmission Company of Nigeria (TCN) and the 11 Distribution Companies (DisCos). In the notice, published this week, the Commission asked for comments from members of the public within 21 days to be considered during the review process.

It said Section 76 of the Electric Power Sector Reform Act (EPSRA) 2005 empowers NERC to have adopted the Multi-Year Tariff Order (MYTO) methodology for electricity pricing.

MYTO allows NERC to do minor review every six months and a major review every five years. It can however, execute an extraordinary tariff review if any power firm seeks for it. Since February 2016 when the MYTO 2015 was implemented, no extraordinary tariff review had been done by NERC. It only managed, in September 2019, to reflect the minor review it did from 2016 to 2018 as that for 2019 pends.

The Commission is in the process of a major review of tariff which could be implemented by January 2020. Justifying the need for the extraordinary tariff, NERC said it is “in instances where the utilities can demonstrate that industry parameters have changed from those used in the operating tariffs to such an extent that a review is required urgently in order to maintain industry viability.”

Economic Confidential reports that TCN had pushed for the extraordinary tariff review since 2017, saying it earns the least revenue from tariff in the electricity market, despite undertaking the huge task of transporting all energy generated to the DisCos.