NERC Insists Discos Will Henceforth Pay for Energy Rejection

Nigerian Electricity Regulatory Commission - NERC

The Nigerian Electricity Regulatory Commission (NERC) said on Thursday that Power Distribution Companies that reject electricity load due to constraints in their network will now have to pay for the capacity charge of the rejected energy.

Power generation and transmission companies had on several occasions complained that Discos were in the habit of rejecting electricity allocated to them for onward distribution to power users.

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The Minister of Power, Sale Mamman, had also condemned the practice.

In order to address this unwholesome situation, the NERC in its Guidelines for Implementation of Economic Merit Order Dispatch and Other Related Matters, stated that going forward, any Disco found wanting in this matter would have to pay. It said this was in accordance with the December 2019 Minor Review of the Multi-Year Tariff Order 2015 and Minimum Remittance Order for the Year 2020.

According to the commission, Section 11 of the order directed that the “Nigerian Bulk Electricity Trading company shall hereafter invoice for capacity charge and energy to Discos based on their load allocation and metered energy respectively.”

It further stated that Section 12 of the order concluded that “where it is established that the Transmission Company of Nigeria is unable to deliver a Disco’s load allocation, TCN shall be liable to pay for the associated capacity charge.”