NERC to penalise DisCos over low energy uptake, poor customer service

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The Nigerian Electricity Regulatory Commission (NERC) has implemented penalties for electricity distribution companies (DisCos) that fail to take up at least 95 percent of the total monthly energy allocated to them for distribution.

According to an order dated July 5, NERC introduced these penalties as part of a performance monitoring framework aimed at protecting electricity consumers.

DisCos will be evaluated based on seven key performance indicators:

1. Energy off-take relative to partial contracted capacity
2. Revenue recovery rate
3. Compliance with reporting a uniform system of accounts
4. Compliance with application programming interface (API) feeder streaming
5. Compliance with the order on capping of estimated bills
6. Compliance with the implementation of forum decisions
7. Compliance with service standards for resolving complaints received through the NERC contact centre and NERC headquarters

NERC stated that failure to offtake at least 95 percent of available nominations in any month will result in the issuance of a rectification directive. If DisCos fail to meet this threshold in two out of three months within any quarter, they will face a “downward adjustment of DisCos guaranteed Admin OPEX by 5 percent for the next quarter.”

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