The Association of Power Generation Companies (APGC) has said the declaration of the ‘Eligible Customers’ and its new Regulation that allows certain customers buy power directly from Generation Companies (GenCos) was a timely intervention for competition in the electricity market.
A statement by the Executive Secretary of the GenCos’ association, Dr. Joy Ogaji said with stranded generation capacity in the electricity market and poor market liquidity, the declaration was the brilliant way to liberate the power sector from the current monopoly of buying power only from the Distribution Companies (DisCos).
Some of the DisCos who are empowered to sell electricity to customers before the regulation started wrote to the Bureau of Public Enterprises (BPE) last week giving a warning for a force majeure. The DisCos’ investors said they may not be able to fulfill their market obligations given the new regulation but BPE which supervised the privatization turned down the request last week.
Citing sections of the Electric Power Sector Reform Act (EPSRA) 2005 and the National Electricity Power Policy (NEPP) 2001, APGC said it was clear that the drafters of the EPSRA 2005 intended the declaration before the 2013 privatization.
Dr Ogaji said, “I believe if there should be any force majeure, the GenCos should declare it for a failure by the market in breaching the contract, taking power and not paying for it after selling all of it.”
APGC in its statement said the regulation will raise competition on electricity demand while reducing the financial risk by supplying creditworthy eligible electricity customers, APGC noted.