NAIJA BIZ

FG takes over Yola DisCo, investors to get N26.9 billion refund

The Federal Government of Nigeria is set to take over Yola Electricity Distribution Company (Yola DisCo), as the Nigerian Senate approved the sum of N26.9 billion as a refund for the acquisition of the company by private investors.

According to Punch, the House of Representatives Committee on Appropriations has recommended the payment of N26.9 billion in its report on the 2020 Appropriation Bill scheduled for consideration and adoption.

Specifically, the provision is listed as Item 188 under the Capital Supplementation component of the 2020 Budget.

FG makes U-turn? An earlier report published on Nairametrics disclosed that Transcorp Power Consortium and Quest Electricity Nigeria had won bid prices for the Afam Electricity Generation Company at N105.3 billion and Yola Electricity Distribution Company at N19 billion respectively.

The National Council on Privatisation announced that it approved Transcorp Power Consortium as the preferred bidder for the Afam Power Plc and Afam Three Fast Power Limited, and Quest Electricity Nigeria Limited as the preferred bidder for the re-privatized Yola DisCo.

It is expected that the private investors would make necessary investments to improve generation and distribution networks, as well as customer service.

This latest disclosure means the Federal Government of Nigeria has decided to take over the full possession of Yola DisCo in an attempt to fix the problems currently ravaging the distribution companies in Nigeria.

Abuja Disco, others run for safety: While the Federal Government may be taking over Yola DisCo, for now, license withdrawals of other distribution companies still looms.

In a recent publication, the Federal Government, through the Nigerian Electricity Regulatory Commission (NERC) disclosed it might withdraw the licences of eight power distribution companies (DisCos) over breaches of some provisions of the Electric Power Sector Reform Act.

According to the regulatory commission, the eight power firms include Abuja, Benin, Enugu, Ikeja, Kaduna, Kano, Port Harcourt and Yola Electricity Distribution Companies.

According to NERC, the licences of the 8 DisCos might be withdrawn due to three main fundamental reasons and these include breaching the provisions of the Electric Power Sector Reform Act (ESPRA), terms and conditions of their respective distribution licences and the Remittance Order of the year 2019.

Meanwhile, the distribution companies are jittery over the move of the government. On Wednesday, according to a report published by Punch, the Abuja DisCo (AEDC) told lawmakers in the National Assembly that it had complied with the demands of the NERC to avert the cancellation of the Disco’s licence by the NERC.

The Managing Director, AEDC, Ernest Mupwaya, stated this while making a presentation and responding to questions from the lawmakers who were on oversight function at the headquarters of the DisCo in Abuja.

AEDC also reportedly told the chairman and members of the House of Representatives Committee on Privatisation and Commercialisation that it had invested N19 billion as capital expenditure on its distribution network.

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