BREAKING NEWS, Power
BABATUNDE Raji Fashola, minister of power works and housing, on Monday, May 8, accused the Association of Nigeria Electricity Distributors, ANED, of failing to come to terms with the contract agreement it made with the central bank of Nigeria. According to a statement issued by his Special Adviser on Communication, Hakeem Bello what ANED failed to say in its recent publication was that the escrow condition was agreed upon by the association with Central Bank as a condition for offering stabilization funds by way of loans to fund the business they invested in since commercial banks were reluctant to do so.
The DISCOs drew a battle line with the Federal Government upon the announcement of intention to centralise and escrow their accounts. The 11 distribution companies under the auspice of ANED issued a press statement that the Federal Government was intending to nationalise the entities in which they bought 60% stake in 2013.
But speaking at the 15th monthly meeting of the power sector operators in Jos, the minister said: “What you (DISCOs) failed to state was that the loan was at 10% interest which is well below commercial rates. What you also failed to state is that you also agreed under that arrangement to establish letters of credit to guarantee future payments to NBET and TCN Market Operations, that the agreed commercial terms of the letters of credit authorizes NBET and TCN Market Operations to draw on the letters of credit for any default in payment to them, and that such defaults have occurred and continue to occur.”
According to the minister, ANED has been silent on what the public needs to hear, he disclosed that “you are entitled to fully recover your costs and investment by law and this is the function of how tariffs calculated.”
He added that “any right-thinking person will accept the principle that any person lending you money must have the right to know what you are doing with the money especially when under collection and underpayment has been a major feature of many Disco performances”
He said that, since the Government holds 40 percent of the shares of Discos on behalf of states and local governments and the Nigerian people, it has a duty to ensure that ANED buys parts and other equipment at reasonable and competitive market prices and not through inflated contracts to relatives as we have seen in some Discos in respect of which NERC will take action in due course and sanction those who are involved.
On the N701.9 billion intervention, the minister said that the intervention fund is consistent with Government’s policy and determination to enable businesses to flourish, and it was meant to save the GENCOs, the gas companies and their financiers who were providing service, from collapse.
He said that while the public constantly blames the Government for a service it does not receive money to provide, good corporate governance will only demand that customers are provided with meters to measure their power usage before seeking tariff increase.
While commiserating with families of the victims of the Electrocution accident in Cross River, the minister recalled that the incident was clearly man-made as the building was located under or close to an electricity line. He added that we must admit as a People that the time to stop cutting corners and violating regulations has come upon us, and the time to change those non-compliant conducts is now, for our own long term benefit. – The Nation
— May 8, 2017 @ 19:55 GMT
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