The Nigerian Electricity Regulatory Commission (NERC) has taken a significant step towards consumer protection by imposing a fine of ₦1.69 billion on the Abuja Electricity Distribution Company (AEDC) for overbilling its customers. This landmark decision, detailed in the regulatory document “Order NERC/2024/114,” was officially published as part of NERC’s September 2024 Supplementary Order.
The fine results from AEDC's failure to comply with NERC's previous directives concerning the capping of estimated billing practices. An investigation revealed that between January and September 2023, AEDC had excessively charged its customers, leading to this substantial penalty, which represents 10% of the total overbilled amount.
NERC's Vice Chairman, Musiliu Oseni, and Commissioner for Legal, Licensing, and Compliance, Dafe Akpeneye, signed the order, emphasizing the commission's commitment to enforcing regulatory compliance and safeguarding consumer interests. The fine will be deducted from AEDC's total annual operating expenditure, effective from September 2024.
In addition to the financial penalty, NERC has mandated AEDC to enhance its service delivery. The company is required to improve monitoring of its electricity supply, particularly to Band A feeders, and must publish explanations for any service disruptions lasting more than two consecutive days by 10 AM the following day.
NERC has also directed AEDC to procure at least 61 megawatts (MW) of embedded generation capacity by April 2025, with a minimum of 30 MW sourced from renewable energy. This initiative is crucial for meeting AEDC's service delivery obligations under the Service-Based Tariff framework.
Furthermore, NERC has approved new tariff rates effective from September 1, 2024, and instituted compensation provisions for customers on Band A feeders who experience service shortfalls.
This decisive action by NERC underscores its ongoing efforts to hold electricity distribution companies accountable for regulatory breaches while ensuring fairness and transparency in Nigeria's electricity market. By enforcing these measures, NERC aims to restore consumer confidence and promote better service delivery across the sector.