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On the 25th November 2015, the West African Power Industry Convention (WAPIC) featured a panel session on the topic “Speeding up the Transition to Cost Reflective Tariffs.” The session was moderated by Dolapo Kukoyi, Partner, Detail Commercial Solicitors and the panel speakers for the session were Yinka Balogun, Special Assistant to the Governor on Energy, Central Bank of Nigeria; Yesufu Longe, Head Power Procurement and Power Contracts Management, Nigeria Bulk Electricity Trading Plc; Jamil Gwamna, MD, Kano Electricity Distribution Company; Olufunke Jones, Head, Power and Energy, Ecobank Nigeria Plc; and Helen Brume, Head, Power and Infrastructure, UBA, Plc.
In her opening remarks, Dolapo emphasized that achieving cost reflective tariffs has been paramount in the Nigerian power sector this year, particularly because this is the year in which the Transition Electricity Market was supposed to take off to ensure an operational market with contracts becoming effective; NBET becoming operational and market participants taking financial and contractual responsibility for their obligations. However, without cost reflective tariffs, these critical next steps have been hindered.
Key take-away points made by the panellist are as following
1. Cost reflective tariffs are essential to the financial viability of the electricity market and the basis for investor confidence. The Government needs to conclude on the tariffs as soon as possible to allow for investments and activation of contracts in the electricity supply industry.
2. Cost reflective tariffs should:
a. allow for recovery of costs;
b. be simple enough to demonstrate how the numbers will work; and
c. flexible on the loss reduction to react to macro-economic shocks.
3. Regulatory risks have been brought about by regulatory uncertainty, which has affected where the industry is now. Regulators should not allow such uncertainty in the future as it could potentially lead to structural collapse of the market and act as a disincentive for investment.
4. The Distribution Companies have to be more accountable to customers. They need to take immediate steps to enumerate and meter their customers.
5. While financial interventions are good, disbursement of such must be measured based on specific outputs as currently being done under the CBN-NEMSF Facility.
Looking at the year ahead, everyone in the industry is awaiting the tariff review because it is critical and closely tied to a lot factors affecting investment in the Nigerian Power Sector.
[/vc_column_text][/vc_column][/vc_row][vc_row type=”vc_default” full_width=”stretch_row_content_no_spaces” css=”.vc_custom_1500547593342{padding-right: 100px !important;}” el_class=”noPaddinRow”][vc_column el_class=”noPaddingLeft” offset=”vc_hidden-lg vc_hidden-xs”][vc_raw_html]JTNDZGl2JTIwY2xhc3MlM0QlMjJ0YWItbWFpbi1zdHJpcCUyMiUzRSUwQSUzQ2RpdiUyMGNsYXNzJTNEJTIydGFiLWJsdWUtc3RyaXAwJTIyJTNFJTNDJTJGZGl2JTNFJTBBJTNDZGl2JTIwY2xhc3MlM0QlMjJ0YWItYmx1ZS1zdHJpcDElMjIlM0UlM0MlMkZkaXYlM0UlMEElM0NkaXYlMjBjbGFzcyUzRCUyMnRhYi1ibHVlLXN0cmlwMiUyMiUzRSUzQyUyRmRpdiUzRSUwQSUzQyUyRmRpdiUzRQ==[/vc_raw_html][vc_empty_space height=”25px”][vc_row_inner][vc_column_inner width=”1/6″][/vc_column_inner][vc_column_inner width=”2/3″][vc_custom_heading text=”Dolapo Kukoyi, DETAIL Partner, Moderates a Session at the West African Power Industry Convention (WAPIC) Held on 25th November, 2015″ font_container=”tag:h1|font_size:22|text_align:justify|color:%236699cc|line_height:1.8″ use_theme_fonts=”yes”][vc_column_text]
On the 25th November 2015, the West African Power Industry Convention (WAPIC) featured a panel session on the topic “Speeding up the Transition to Cost Reflective Tariffs.” The session was moderated by Dolapo Kukoyi, Partner, Detail Commercial Solicitors and the panel speakers for the session were Yinka Balogun, Special Assistant to the Governor on Energy, Central Bank of Nigeria; Yesufu Longe, Head Power Procurement and Power Contracts Management, Nigeria Bulk Electricity Trading Plc; Jamil Gwamna, MD, Kano Electricity Distribution Company; Olufunke Jones, Head, Power and Energy, Ecobank Nigeria Plc; and Helen Brume, Head, Power and Infrastructure, UBA, Plc.
In her opening remarks, Dolapo emphasized that achieving cost reflective tariffs has been paramount in the Nigerian power sector this year, particularly because this is the year in which the Transition Electricity Market was supposed to take off to ensure an operational market with contracts becoming effective; NBET becoming operational and market participants taking financial and contractual responsibility for their obligations. However, without cost reflective tariffs, these critical next steps have been hindered.
Key take-away points made by the panellist are as following
1. Cost reflective tariffs are essential to the financial viability of the electricity market and the basis for investor confidence. The Government needs to conclude on the tariffs as soon as possible to allow for investments and activation of contracts in the electricity supply industry.
2. Cost reflective tariffs should:
a. allow for recovery of costs;
b. be simple enough to demonstrate how the numbers will work; and
c. flexible on the loss reduction to react to macro-economic shocks.
3. Regulatory risks have been brought about by regulatory uncertainty, which has affected where the industry is now. Regulators should not allow such uncertainty in the future as it could potentially lead to structural collapse of the market and act as a disincentive for investment.
4. The Distribution Companies have to be more accountable to customers. They need to take immediate steps to enumerate and meter their customers.
5. While financial interventions are good, disbursement of such must be measured based on specific outputs as currently being done under the CBN-NEMSF Facility.
Looking at the year ahead, everyone in the industry is awaiting the tariff review because it is critical and closely tied to a lot factors affecting investment in the Nigerian Power Sector.
[/vc_column_text][/vc_column_inner][vc_column_inner width=”1/6″][/vc_column_inner][/vc_row_inner][/vc_column][/vc_row][vc_row type=”vc_default” full_width=”stretch_row_content_no_spaces” css=”.vc_custom_1500547593342{padding-right: 100px !important;}” el_class=”noPaddinRow”][vc_column el_class=”noPaddingLeft” offset=”vc_hidden-lg vc_hidden-md vc_hidden-sm” css=”.vc_custom_1530205361920{padding-right: 75px !important;padding-left: 60px !important;}”][vc_raw_html]JTNDZGl2JTIwY2xhc3MlM0QlMjJtb2ItbWFpbi1zdHJpcCUyMiUzRSUwQSUzQ2RpdiUyMGNsYXNzJTNEJTIybW9iLWJsdWUtc3RyaXAwJTIyJTNFJTNDJTJGZGl2JTNFJTBBJTNDZGl2JTIwY2xhc3MlM0QlMjJtb2ItYmx1ZS1zdHJpcDElMjIlM0UlM0MlMkZkaXYlM0UlMEElM0NkaXYlMjBjbGFzcyUzRCUyMm1vYi1ibHVlLXN0cmlwMiUyMiUzRSUzQyUyRmRpdiUzRSUwQSUzQyUyRmRpdiUzRQ==[/vc_raw_html][vc_empty_space height=”25px”][vc_row_inner][vc_column_inner width=”1/6″][/vc_column_inner][vc_column_inner width=”2/3″][vc_custom_heading text=”Dolapo Kukoyi, DETAIL Partner, Moderates a Session at the West African Power Industry Convention (WAPIC) Held on 25th November, 2015″ font_container=”tag:h1|font_size:22|text_align:justify|color:%236699cc|line_height:1.8″ use_theme_fonts=”yes”][vc_column_text]
On the 25th November 2015, the West African Power Industry Convention (WAPIC) featured a panel session on the topic “Speeding up the Transition to Cost Reflective Tariffs.” The session was moderated by Dolapo Kukoyi, Partner, Detail Commercial Solicitors and the panel speakers for the session were Yinka Balogun, Special Assistant to the Governor on Energy, Central Bank of Nigeria; Yesufu Longe, Head Power Procurement and Power Contracts Management, Nigeria Bulk Electricity Trading Plc; Jamil Gwamna, MD, Kano Electricity Distribution Company; Olufunke Jones, Head, Power and Energy, Ecobank Nigeria Plc; and Helen Brume, Head, Power and Infrastructure, UBA, Plc.
In her opening remarks, Dolapo emphasized that achieving cost reflective tariffs has been paramount in the Nigerian power sector this year, particularly because this is the year in which the Transition Electricity Market was supposed to take off to ensure an operational market with contracts becoming effective; NBET becoming operational and market participants taking financial and contractual responsibility for their obligations. However, without cost reflective tariffs, these critical next steps have been hindered.
Key take-away points made by the panellist are as following
1. Cost reflective tariffs are essential to the financial viability of the electricity market and the basis for investor confidence. The Government needs to conclude on the tariffs as soon as possible to allow for investments and activation of contracts in the electricity supply industry.
2. Cost reflective tariffs should:
a. allow for recovery of costs;
b. be simple enough to demonstrate how the numbers will work; and
c. flexible on the loss reduction to react to macro-economic shocks.
3. Regulatory risks have been brought about by regulatory uncertainty, which has affected where the industry is now. Regulators should not allow such uncertainty in the future as it could potentially lead to structural collapse of the market and act as a disincentive for investment.
4. The Distribution Companies have to be more accountable to customers. They need to take immediate steps to enumerate and meter their customers.
5. While financial interventions are good, disbursement of such must be measured based on specific outputs as currently being done under the CBN-NEMSF Facility.
Looking at the year ahead, everyone in the industry is awaiting the tariff review because it is critical and closely tied to a lot factors affecting investment in the Nigerian Power Sector.
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