NERC Orders Automatic Downgrade for Band A Feeders Failing to Meet Supply Requirements

The Nigerian Electricity Regulatory Commission (NERC) has mandated all distribution companies (DisCos) to automatically downgrade any Band A feeder that does not enjoy the minimum requirement of 20 hours per day power supply for seven consecutive days.

This order forms part of the Service Delivery Commitments for every DisCo, in line with the Supplementary Order to the Multi-Year Tariff Order (MYTO) 2024, effective from April 3, 2024.

NERC also requires DisCos to publish an explanation of the reasons for any failure to meet the committed service level on a Band A feeder for two consecutive days, along with an update on the timeline for service restoration.

If a Band A feeder fails to meet the committed service level for seven consecutive days, the feeder will be automatically downgraded to the recorded level of supply in accordance with the applicable framework.

In addition, each Disco is required to establish a rapid response team to ensure effective service delivery on the committed minimum hours of supply to each service band, starting with Band A feeders.

The directive follows the recent approval of an increase in electricity tariff for Band A customers, from about N66 to N225 per kilowatt hour, effective April 3, 2024.

This increase applies only to customers enjoying 20 hours power supply and above across the country.

NERC emphasized that the new tariff was approved after considering various economic indicators, such as inflation rate, exchange rate, generation cost, transmission and admin cost, and wholesale gas to power prices.

The Commission also noted that customer protection remains a priority in implementing the initiative.

The newly approved tariffs are expected to reduce subsidies for the 2024 fiscal year by about N1.14 trillion, as the federal government realigns its subsidy regime.

The NERC has established a robust monitoring framework, leveraging technology to ensure that the public has visibility of the service covenant with their service providers.

An enforcement and compensation mechanism has also been established in the event of service failure.

The Commission remains committed to providing adequate and reliable electricity to all citizens, working diligently with state governments to deliver on the gains of the Electricity Act 2023.