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No more subsidies for DISCOs – FG

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The Federal Government said Wednesday that it  would no longer extend subsidies to the Electricity Distribution Companies, DISCOs, because they have failed to make optimum use of the financial interventions granted them.

Minister of Power, Sale Mamman, who briefed  State House correspondent’s on the outcome of the weekly Federal Executive Council, FEC, Meeting said his ministry presented a memo to FEC to that effect.
Specifically, he said the Ministry of Power has submitted a memo to FEC) to decide the fate of DISCOs that have failed to honour their commitments to buy and distribute adequate power generated for them by the generation companies (GENCOs)

The Minister explained that the DISCOs do not evacuate all of the about 7,000 megawatts generated by the GENCOs, which distribute 3,000 megawatts but eventually pay for only 15 percent of this.

According to him, the implication is technical economic losses as the GENCOs don’t get value for the electricity they generate and the end consumers also do not get adequate electricity despite the output of the GENCOs.

Although he declined to give details of his recommendations to FEC, Hassan stressed that in view of the situation, the DISCOs may have to quit and give way to more capable operators if they are not able to fulfil their obligations as agreed with government.

He said: : “Most of the problem we are facing in this country that we cannot get electricity supplied adequately and efficiently is because we have a problem in distribution. Generation, no more problem.

“We can generate up to 13,006 megawatts but the transmission, those who are taking the electricity supply can only take 7,000 megawatts, even at that they are not taking the whole 7,000 megawatts but only 4,500 megawatts and then send to distribution, the distribution in turn receives only 3,000 megawatts.

“Because of the technical and commercial reasons, they cannot contain the whole power that has been generated. So, we have to correct the infrastructure.

“Government has signed memorandum of understanding with the German government, Siemens. They are to align between distribution and transmission and also generation. So that at the end of the day if we generate 13,000 megawatts, transmission will take the whole 13,000 and will distribute same, that way Nigerians will be happy and everyone will have 24/7 electricity supply.

“The DisCos are the ones manning the distribution, that is why I have submitted by observations  to the government, it is left for the government  that will have to decide. We just have to sit and see whether they are capable, have the technical know how because most of the problems we are having today is the loss- technical loss and commercial loss.

“They will give you light and may not collect your money or they will collect the money and pocket, or they may send light and you may not have good sub-station that may collect this power and distribute to customers. This has been our major problem and it is the responsibility of the DisCos to take care of that end.

“Government cannot continue subsiding because what they (DisCos) are doing is that they collect 3,000 megawatts and pay for only 1,000 megawatts, that is 15 percent of what they are collecting, so government is the one completing the payment.

“So, we cannot continue like that. So if they are ready to continue, fine; but if they are not ready to continue maybe they should give way to whoever that is ready to come and invest. So we are asking government to review and see if they are capable, but if they are not capable they should give way.”

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