The Nigerian Electricity Regulatory Commission (NERC) has set terms and conditions for the new owners of electricity on how to access the N213billion intervention fund from the Central Bank of Nigeria (CBN).
This was disclosed by the Chairman, NERC, Dr. Sam Amadi while fielding questions from energy correspondents on the conditions and the expected impacts of the fund.
Amadi said that the stipulated funds disbursement conditions must be met before an operator could benefit from the loans.
The Chairman said, apart from the performance agreement put in place for the benefitting operators, the Commission has also developed a monitoring and evaluation mechanism that would include the inputs of electricity consumers across the country and the funds’ manager.
He dismissed insinuations that the fund was a bailout for the collapsing electricity market, argued that the market was stable but required such loan to help support its transition into a contract
“We are putting in place a performance agreement with every party receiving the funds. Before they receive the funds therefore, they will commit to certain performance standards which they must meet.
“For instance, gas suppliers would commit to supply agreed quantities of gas under a very clear and enforceable contract while Gencos and Discos would commit to invest in relevant upgrades and improvements in areas like metering, transformer replacement and general change management,” he noted.
According to him, “The disbursement will be done in tranches so that if a party does not live up to the performance agreement, then it will not receive the next tranche of funds. But if it does, it will then be cleared by NERC to receive the next tranche.
“That way, there would be checks and balances that ensure compliance with the performance agreement. NERC wants to ensure that this entire process is not only transparent but also productive. NERC will soon be announcing the modalities for this novel consumer-centric monitoring system,” Amadi said.