The Director-General of the Bureau of Public Enterprises (BPE), Alex Okoh, has faulted plans by the Electricity Distribution Companies (DisCos) to declare force majeure in the power sector, saying there was no basis for such action.
The DisCos have threatened to resort to such a step following what they termed the policy directive on Eligible Customers and the Eligible Customer Regulations by the Nigerian Electricity Regulatory Commission (NERC).
Okoh, in a letter, challenged the assertion by the DisCos that there has been a change in law and political force majeureevent pursuant to certain clauses in the Performance Agreement the core investors of the DisCos signed with the BPE, stating that he rejected the notice to declare force majeure by the DisCos.
BPEs Head, Public Communications, Chukwuma Nwokoh, in a release yesterday, said the DisCos had claimed that the policy directive on Eligible Customers and the Eligible Customer Regulations have resulted in a change of law which prevents them from fulfilling their obligations under the Performance Agreement.
But he pointed out that Okoh countered, stating that pursuant to the Electricity Power Sector Reform Act, 2005, it is obvious that the Minister of Power, Works and Housing, is empowered to issue the policy directive specifying the class, or classes of end-use customers that shall constitute Eligible Customers. In the same vein, NERC is similarly empowered to issue Eligible Customer Regulations.
He said:“As you are aware, this is the same Act which midwifed the process whereby the power assets were privatized to the core investors. Given that the Declaration and the Regulations were lawfully and validly issued by the Minister and NERC, and that there has been no change in the law giving rise to a political force majeure event, we are unable to see the basis for the issuance of the notice.”
Okoh stressed that the BPE, as the contracting party on behalf of the Nigerian government to the agreements which governed the privatization of the power assets to the core investors, rejects the notice to declare force majeure.