States seek DisCos bypass to buy energy directly from GenCos

The Forum for Commissioners of Power and Energy in Nigeria (FOCPEN) which are representatives of state governments yesterday sought the signing of interim Power Purchase Agreements (PPAs) for SubCos to buy energy directly from electricity Generation Companies (GenCos).

It is an indication that the state governments are seeking the application of the eligible customer regulation of 2017 that makes it possible for customers to purchase energy directly from the GenCos.

In this case, the states are requesting for agreements to bypass the DisCos in the value chain.

According to a press statement the forum issued from Abuja, “Such regulation may include a mandate for NBET to enter into direct or interim Power Purchase Agreements (PPAs) with SubCos.”

The forum also called on the Minister of Power, Chief Adebayo Adelabu to intervene and ask the Nigerian Electricity Regulatory Commission (NERC) and Enugu Electricity Distribution Company (EEDC) to restore electricity to the people of the state.The EEDC had reduced energy allocation to the state owing to the decision of the Main Power Electricity Distribution Ltd to reduce band A tariff from N209/kWh to N160/kWh.

According to Main Power, EEDC has said implementing the adjusted tariff would cause a monthly loss of N1 billion. The EEDC has therefore reduced energy supply to the people of the state.

Responding to the situation, the FOCPEN stressed that “FOCPEN calls upon the Minister of Power, Chief Bayo Adelabu, to immediately intervene and prevail upon NERC and EEDC to reverse the power cuts and restore electricity to the people of Enugu State.”

The forum insisted  that as the chief policy maker for the sector, the Minister must take decisive action to stop the lawlessness by DisCos who can arbitrarily and without consequence deprive citizens of electricity.The forum also said NERC must develop appropriate regulations that would allow SubCos enter into bilateral contracts with GenCos to procure wholesale power from the national grid.

The forum said the current arrangement, where SubCos receive power through their HoldCos is an anti-competitive practice that limits their operational autonomy within SEMs and creates a potential for abuse, as evidenced by the current crisis.

FOCPEN also urged that there must be regulatory sanctions against EEDC.

“Apply Regulatory Sanctions against EEDC: NERC must sanction EEDC for its actions.  The Commission must prove that it has the teeth to regulate the NESI as the apex regulator and protect consumers from the tyranny of powerful Successor DisCos HoldCos that are currently its licensees,” said the forum.

The FOCPEN strongly condemned the recent and ongoing power outages in Enugu State, attributable to a deliberate action by EEDC to reduce power to Enugu State electricity market.

The statement reads in part: “EEDC has based its decision  on the recent tariff order issued to its subsidiary company, MainPower Electricity Distribution Limited (“Main Power”), by the Enugu Electricity Regulatory Commission (the “Regulator”), which reduced Band A electricity tariffs from N209/kwh to N160/kwh effective from August 1st, 2025.

“FOCPEN views this unilateral action by EEDC not merely as a regulatory dispute with the Regulator, but as a declaration of war on the good people of Enugu State by EEDC. FOCPEN wishes to state that EEDC’s reckless action is a grave violation of its license obligations under existing national electricity regulations. EEDC’s action is also a clear demonstration of the flawed privatization process that has empowered private investors of DisCos to deprive citizens of essential electricity services with impunity.

“FOCPEN wishes to state unequivocally that if MainPower or EEDC believe the tariff as set by the Regulator is inadequate, the appropriate and legal path is to seek a review through established regulatory processes.

 To resort to an arbitrary disconnection or reduction of power by up to 50% to a State, smacks of blackmail by EEDC.

“EEDC’s action also portends grave danger for consumer rights in the NESI, and undermines the ongoing implementation of State Electricity Markets (SEM). Furthermore, it exposes the alarming market power of DisCos to hold electricity regulators at sub-national and at the federal level, to ransom. EEDC’s action sets a dangerous precedent for other DisCos to undermine the successful implementation of the Electricity Act 2023 and decentralization of electricity regulations.

“FOCPEN calls on the Nigerian Electricity Regulatory Commission (NERC) to immediately call EEDC to order. NERC, as the current regulator of EEDC, must investigate this matter thoroughly and sanction this unacceptable action by EEDC, which FOCPEN believes has no regulatory approval from NERC.

“To prevent such reckless action by a Distribution Licensee from happening again, FOCPEN demands the following: