In a bold move aimed at tightening regulatory oversight and overhauling Nigeria’s fragile electricity infrastructure, the Nigerian Electricity Regulatory Commission (NERC) has taken two major steps: penalizing the Abuja Electricity Distribution Company (AEDC) for customer exploitation and unveiling a new Transmission Infrastructure Fund to bridge gaps in the national grid.
NERC imposed a ₦1.69 billion sanction on AEDC after investigations revealed the utility company had overbilled customers between May and September 2023.
The amount, which represents 10 percent of the excess charges during that period, will be deducted from AEDC’s 2024 approved Operating Expenditure, the commission said.
“This deduction sends a clear message that DisCos will be held accountable for non-compliance with our regulatory frameworks,” NERC said in a statement issued on Thursday. “The practice of arbitrarily estimating bills for customers must end.”
The penalty follows AEDC’s breach of the Order on Capping of Estimated Bills, a policy that seeks to shield unmetered customers from unfair electricity charges. NERC also reminded the distribution company of its obligation to align customer charges with the actual service delivered.
“We expect DisCos to match end-user tariffs with the level of electricity supplied, as measured in average daily hours per customer cluster,” the commission noted.
In what appears to be a strategic counterbalance to the punitive measure, NERC also announced the launch of a Transmission Infrastructure Fund. The commission said the fund will serve as a financial catalyst to address Nigeria’s chronic transmission shortcomings.
“The fund will support critical transmission projects and innovative initiatives that enhance delivery within the Nigerian Electricity Supply Industry (NESI),” NERC stated, adding that it could back vendor-financing and public-private partnerships (PPPs) aimed at modernizing the aging national grid.
