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Is Discos deceiving critics with sudden N935bn five-year investment plans?

There are strong speculations that the recent indication that electricity distribution companies (Discos) are set to invest N935bn in their networks stemmed from unprecedented complains and outcries of both the Transmission Company of Nigeria (TCN) and even generation firms.

However, several industry analysts, who spoke with our correspondents, are of the view that the Discos’ move is a survival strategy and suspiciously diversionary to deceive government in dumping plan of possible revocation of their licences.

Some of the experts queried how many banks had been contacted by the Discos and why sudden change of mind having been arguing that they cannot make any investment in their networks with the current billing template which they claim is inadequate to drive investment.

It would be recalled that the TCN and been on the neck of Discos, saying that the huge electricity supply gaps and complains coming from customers stemmed from the frustrations and weak distribution networks of the Discos.

But the Discos had continued to deny the situation, claiming that their networks are strong enough to carry any volume of power which pundits had continued to disregard.

In a recent interview, the Managing Director of TCN, Usman Mohammed said “We have written our position to government on the issue of recapitalisation of the Discos and the Ministry of Finance has been asked to look into it. This is a fact. The good news is that the government at the highest level has agreed with us on the issue of recapitalization.”

“We have 177 interfaces with the Discos that are completely connected to our substations directly and this is leading to so many problems. Let me give you an example, you will see a situation where in a day, a 33kV line can trip more than 10 times. This is unsustainable.

“It is increasing our cost and making things very difficult. So, we have to ask for monetary investment on the side of the Discos so that they can be able to pick the load and rehabilitate their networks in order to ensure that the expansion we are doing at the TCN can lead to a clear improvement in the lives of Nigerians.

“This is because only less than 20 customers are connected directly to the grid; all other customers are connected through the distribution network,” Mohammed noted.

Latest data obtained from the Nigerian Electricity Regulatory Commission (NERC) on the Performance Improvement Plans of the Discos showed that the power firms had mapped out over N900bn to be invested in their networks between 2019 and 2024.

Though papers submitted to the NERC by eight Discos showed that the firms would expand their networks with at least N935bn, but efforts to sight their business plan and financing sources failed.

Some of the eight Discos coming up network expansion and upgrade plans include Abuja, Ikeja, Benin, Kaduna, Kano, Enugu, Ibadan and Eko.

The Discos explained in their memos to NERC that their planned investment will cut across facility upgrade and deliveries including meters, transformers and power distribution lines.

Details showed that whereas Abuja, Ikeja, Eko and Enugu Discos planned to invest N56bn, N105bn, N78.6bn and N118bn, respectively over the five-year period, troubled Benin, Kano, Kaduna and Ibadan Discos will sink N287bn, N49.8bn, N112bn and N83bn, respectively during the same period.

Though the power firms assured that the planned investment would among other things, enhance their service deliveries in meeting demands of operators and electricity consumers across the country, the fear of experts who doubt their sincerely is their inability to hide their financing plan or sources of funding.