The Nigerian Electricity Regulatory Commission (NERC) has imposed a fine of N1.69 billionn on Abuja Electricity Distribution Company (AEDC) for overbilling customers.
The penalty, documented in Order NERC/2024/114, titled September 2024 Supplementary Order to the Multi-Year Tariff Order 2024 for AEDC, was slammed on the DisCo on Thursday as part of the commission’s September 2024 Supplementary Order.
The regulatory document, ORDER/NERC/2024/114 dated August 30 and signed by Vice Chairman, Musiliu Oseni, and Commissioner, Legal, Licensing and Compliance, Dafe Akpeneye, was published on NERC’s website.
According to NERC, the fine is based on AEDC’s non-compliance with the commission’s previous order on capping estimated billing for electricity consumers.
The commission stated that after investigating AEDC’s billing practices, it identified that the DisCo had overcharged customers from January to September 2023, leading to the imposition of the fine, which is equivalent to 10% of the over-billing value.
The regulatory document outlined the reasons behind the fine and adjustments to AEDC’s revenue requirements and tariffs, stating that the commission has “approved the deduction of N1.69bn from the total annual OpEx of AEDC effective September 2024, being 10 per cent of the over-billed amount by AEDC for the period covering January-September 2023.”
The fine was levied in response to complaints by consumers and subsequent investigations that revealed AEDC had not adhered to the regulatory guidelines on estimated billing.
NERC’s order emphasised: “The commission has approved the deduction of N1.69bn from AEDC’s annual operating expenditure as a penalty for non-compliance with the order on capping estimated bills.”
In addition to the fine, NERC also issued directives aimed at improving service delivery and monitoring compliance with service-based tariffs.
For instance, AEDC is required to ensure the continuous monitoring of its service levels, particularly regarding electricity supply to Band A feeders.
The Order further specified: “Where AEDC fails to deliver on the committed level of service on a Band A feeder for consecutive two days, AEDC shall on the next day by 10am publish on its website an explanation of the reasons for the failure.”
The Supplementary Order also mandated the DisCo to procure and not later than April 2025, a minimum of 61MW of embedded generation, with at least 30MW sourced from renewable energy, to improve the reliability of electricity supply within its franchise area.
NERC stressed that the regulatory measure was necessary to meet AEDC’s service delivery commitments under its Service-Based Tariff framework.
On the adjustments to AEDC’s tariffs, the commission had approved new tariffs effective from September 1, 2024, which also made provisions for compensating customers for service failures, particularly for those on Band A feeders.
The Order further clarified: “AEDC shall make appropriate compensation to the affected customers in Band A feeders listed in Appendix 3 for failure to deliver up to 20 hours of average supply but more than 18 hours of average supply.”
