NERC approves N153.3bn CAPEX for DisCos in 2024

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The Federal Government (FG), through the Nigerian Electricity Regulatory Commission (NERC), has approved a total N153.2 million Capital Expenditure (CAPEX) for the 11 Electricity Distribution Companies effective January 1, 2024.

The adjustments requires the DisCos to commit to service improvement programmes that will ensure improved power supply, reduction of Aggregate Technical, Commercial and Collection losses (ATC&C), and implementation of effective billing and payment structure, as well as improved customer metering.

New CAPEX packages were approved for each of the DisCos under the Performance Improvement Plans(PIP)in separate orders based on engagements with NERC for justification of the associated costs and resulting tariffs.

According to the Multi-Year Tariff Order (MYTO) 2024 recently released by the Commission, the approved CAPEX for each DisCos differs.

In a breakdown, the highest amount was approved for Eko Electricity Distribution Company(EKEDC), Ikeja DisCo and Abuja Electricity Distribution Company(AEDC) with N23 billion, N19 billion and N18 billion respectively.

Yola Electricity Distribution Company(YEDC) got the least with an approximate N7 billion.

The allocated amounts are expected to assist the DisCos with their growth initiatives in their respective service improvement investment programs.

From the entire funds, the Commission approved N6.25 billion for each of the DisCos to install a minimum 65,000 meters annually, a move jeered towards phasing out the use of estimated billing methodologies within their networks.

The amount is fixed for DisCos’ meter roll-out programme annually for a period of five years, that is from 2023-2027.

Meanwhile, the Regulator also set new Aggregate Technical, Commercial and Collection (“ATC&C”) loss target for the DisCos.

The DisCos according to the Order, had proposed a review to reset their new baseline ATC&C loss levels.

“The approved ATC&C loss level is considered to be fair and reasonable given current operating conditions and comparable benchmarks within and outside NESI,” it said.

For AEDC, the Commission approved a new baseline ATC&C loss level of 25 percent, 20.6 percent, 16.97 percent and 13.99 percent respectively starting 2024 to 2027.

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