The Nigerian Electricity Regulatory Commission (NERC) has said that six out of eight Power Distribution Companies (DisCos) have complied or substantially complied with the approved minimum remittance threshold in the Order for July to September 2019. NERC, the regulator of the industry, confirmed the development in a notice sent to the affected companies. The notice dated December 12 2019 was signed by Mr Dafe Akpeneye, Commissioner, Legal Licensing and Compliance, NERC. It said only Enugu Electricity Distribution Company Plc and Port Harcourt Electricity Distribution Company Plc failed to comply with the remittance directive in the period under review.

It will be recalled that NERC had on November 5 served notice to eight DisCos of its intention to cancel their licences for failure to meet their obligated remittance to the market. “The Commission has reasonable cause to believe that the DisCos listed below have breached the provisions of the Electric Power Sector Reform Act, terms and conditions of their respective distribution licences and the 2016 – 2018 Minor Review of the Multi Year Tariff Order (MYTO) and Minor Remittance Order for the year 2019. The affected DisCos include the Abuja Electricity Distribution Company Plc, Benin Electricity Distribution Company Plc, Enugu Electricity Distribution Company Plc and Ikeja Electric Plc.

“Others are Kaduna Electricity Distribution Company Plc, Kano Electricity Distribution Company Plc, Port Harcourt Electricity Distribution Company Plc and Yola Electricity Distribution Company,” it said. However, NERC said the affected DisCos were given till Dec. 9 to show cause in writing as to why their licences should not be withdrawn. According to NERC, all eight DisCos met the deadline for the submission of written responses showing cause against the cancellation notice and these responses have been filed at the commission.

NERC said: “The remittance to Nigerian Bulk Electricity Trading (NBET) Plc by the DisCos to date indicates that six out of the eight DisCos (AEDC, BEDC, IE, KEDCO, YEDC and KAEDCO) met the expected minimum remittance thresholds for the three months of July to September 2019.

“Two out of the eight DisCos (EEDC and PHEDC) did not meet the expected minimum remittance thresholds for any of the three months of July to September 2019. The commission reiterates that the failure of DisCos to comply with expected minimum remittance threshold in the order exposes Nigerian Electricity Supply Industry (NESI) to systemic risk.

“It threatens the sustainability of other parts of the value chain and the ability to improve services to customers.” The commission said consequently, a public hearing would be held by NERC on Dec. 19 on the issues affecting the two non-compliant DisCos in line with Section 41 of Electric Power Sector Reform Act and Section 17 of the Business Rules. NERC said in recognition of the “good faith” demonstrated by the six other DisCos, the commission and their management would meet on Dec. 20 to address issues concerning them instead of a public hearing.

Market Statistics Thursday, 13th April, 2017

Market Cap (N’bn) 8,826.8
Market Cap (US$’bn) 28.8
NSE All-Share Index 25,510.01
Daily Performance % 0.1
Week Performance % (1.0)
YTD Performance % (5.1)
Daily Volume (Million) 349.3
Daily Value (N’bn) 2.3
Daily Value (US$’m) 7.4

The equities market closed positive at the end of trade today as the All Share Index (ASI) added 5bps to close at 25,510.01 points. Consequently, market capitalisation advanced N4.6bn to settle at N8.8tn while YTD loss remained at 5.1%. STANBIC (+2.2%), WAPCO (+1.9%) and ZENITH (+1.3%) were the major drivers today. Also, market activity improved as volume and value traded rose 41.0% and 82.8% to settle at 349.3m units and N2.3bn respectively.

Mixed Performance across Sectors
Performance across sectors was mixed as 2 sector indices advanced while 3 declined. The gainers’ chart was topped by the Industrial Goods index (+0.9%) following gains recorded in WAPCO (+1.9%). Similarly, the Oil & Gas index improved 0.1% on the back of price appreciation in OANDO (+2.0%). On the flipside, the Consumer Goods, Insurance and Banking indices slid 0.1% apiece, dragged by losses in NIGERIAN BREWERIES (-0.4%), AIICO (-3.6%) and GUARANTY (-0.7%).

Investor Sentiment Improves
Investor sentiment improved today as market breadth settled at 1.6x (from 1.2x yesterday) after 18 stocks advanced against 11 declining stocks. The best performing stocks were CILEASING (+8.5%), NASCON (+5.3%) and TRANCORP (+3.9%) while UNIONDICON (-5.0%), AIICO (-3.6%) and FORTE (-1.5%) declined the most. Next week, we expect market performance to continue to fluctuate in margins as investors await the release of Q1:2017 earnings reports.

NASD OTC Exchange Market Activities
In the NASD OTC exchange, total volume and value of transactions traded stood at 555,098 units and N5.5m respectively. WAMCO (+1.4%), AFRILAND (+5.7%) and CSCS (+9.9) closed in the green while AIRLIQ (-5.0%) was the sole decliner.

Afrinvest

The Minister of Finance, Mrs. Kemi Adeosun said that the  Federal Government is determined to expand the coverage of the Treasury Single Account (TSA) to cover more agencies in 2017.

Speaking in Abuja at the opening of a two-day retreat on the TSA, the Minister, who described the implementation of the policy as a success story, said the Federal Government would expand the programme and continue to persuade statutory agencies to come under the Treasury Single Account.

The Minister, who disclosed that the Federal Government is already discussing with service providers said Government would improve the implementation and functionality of the TSA because of its huge benefits.

She also stated that the Government would be reaching out to TSA service providers in order to allow other e-commerce and e-payment providers access the platform, which, according to her, is very important to make the TSA as competitive as possible, in terms of pricing.

“One of the challenges that we have is who should bear the cost of the TSA? Currently, it is being borne centrally but that is not sustainable. We are now working on how to stratify the various agencies. Those who should bear their own costs and costs that should be borne by the Government. This will be rolled out in this year,” the Minister stated.

Speaking to the broader benefits of the TSA, the Minister stated that the Federal Government, through the Office of the Accountant General of the Federation, has issued Circulars to banks arising from revelations through the implementation of the whistleblower policy, that some banks have not fully remitted Government funds in their possession.

She stated, “There are still funds in commercial banks and we have written to the banks, giving them a window to come forward. Where in doubt, they have been asked to consult us. We also have an audit team that has started the process of checking the completeness of monies that were transferred into the TSA and already, they have been able to recover a significant amount of money”.

She stated that the TSA policy is here to stay, saying the policy, which she described as an important reform of the current administration, allows Government to reduce its borrowing costs.

“The policy allows us to manage our treasury functions with far more accuracy than what we had in the past. There is still a long way to go but overall, we are very satisfied with the progress we have made and we look forward to it being extended and utilised far more as the year goes on,” the Minister stated.