NERC transfers regulatory oversight to Imo

The Nigerian Electricity Regulatory Commission (NERC) has issued an order transferring regulatory oversight of the electricity market in Imo to the Imo State Electricity Regulatory Commission, in compliance with the Electricity Act 2023.

The order, signed by the NERC Chairman, Sanusi Garba, and obtained by The Guardian on Saturday, shall take effect from July 1, 2024.

The Guardian gathered that Imo is the fourth state to get electricity regulatory authority after Enugu, Ondo, and Ekiti States.

According to the commission, the Government of Imo State has initiated the implementation of the provisions of the recent amendment to the constitution and the Electricity Act and complied with the conditions precedent in the laws mentioned above.

The state, desirous of assuming regulatory oversight of the intrastate electricity market in Imo State, duly notified the commission and requested the transfer of regulatory oversight of the intrastate electricity market in Imo State in compliance with the provisions of the Electricity Act.

The order stated that Section 230(3) of the Act mandates the commission to develop a transition plan and timeline for the transfer of regulatory oversight of the intrastate electricity market from NERC to ISERC upon receipt of a formal notification from the state.

Consequently, the commission directed the Enugu Electricity Distribution Company to incorporate a subsidiary (“EEDC SubCo”) under the Companies and Allied Matters Act for the assumption of responsibilities for the intrastate supply and distribution of electricity in Imo State from EEDC.

“EEDC shall complete the incorporation of EEDC SubCo within 60 days from the effective date of this order and, EEDC SubCo shall apply for and obtain a license for the intrastate supply and distribution of electricity from ISERC.

“EEDC shall identify the actual geographic boundaries of Imo State and carve out its network in Imo State as a standalone network with the installation of boundary meters at all border points where the network crosses from Imo State into another state.

“EEDC shall create an Asset Register of all its power infrastructure located within Imo State; evaluate and apportion contractual obligations and liabilities attributable to EEDC’s operations of its subsidiary in Imo State; identify all the applicable trading points for energy offtake for the operations of EEDC SubCo in Imo State,” it ordered.

The DisCo was also asked to confirm the number of employees required to provide services to Imo State as a standalone public utility; and transfer the identified assets for operations in Imo State, contractual obligations, liabilities, and employees to EEDC SubCo.

The commission said it shall prepare a register of licensees, permit holders, certificate holders, and holders of any other authorizations from the commission in Imo State.

The register, it said, shall be delineated along the lines of authorised activities and use of the national grid for their activities.

“A transfer of regulatory oversight notification shall be issued by the commission to the companies in the register whose activities are limited within Imo State informing the entities of the transfer/assumption of regulatory oversight for their activities by ISERC.

“All cross-border transactions involving the national grid shall be subject to the approval of the commission in accordance with the CFRN and EA.

“ISERC shall confirm to the commission the contractual details for the supply of energy and capacity that shall supply EEDC SubCo in Imo State, and where reliance shall be made on the national grid or other interstate sources of generation; EEDC SubCo shall seek appropriate authorization/approval from the commission in accordance with the CFRN and EA,” the order read partly.

It mentioned that the Imo regulatory body shall have the exclusive responsibility of determining and adopting an end-user tariff methodology applicable within its area of regulatory oversight.

The order added that where EEDC SubCo receives electricity from grid-connected plants, the contracts and tariffs applicable for generation and transmission services shall be approved by the commission.

The final end-user tariffs approved by ISERC shall be the exclusive tariffs that apply in Imo State. All tariff policy support for end-use customers in Imo State shall be the responsibility of the Imo State Government.

“All transfers envisaged by this order shall be completed by 31 December 2024,” it stated.

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