Mini-grid policy to become regulation by Q1 2017 – NERC
The Nigerian Electricity Regulation Commission (NERC) is optimistic that the min-grid draft policy released in October 2016 to guide the development of embedded power will become law in the first quarter of 2017.
Chikwerem Obi, chief of staff to the Chairman/CEO of NERC who is tasked with aggregating views of stakeholders on the draft mini-grids policy confirmed exclusively to BusinessDay that only the confirmation of the appointment of commissioners by the national assembly stood in the path of the policy.
“Right now we have got the views of stakeholders, they have made their inputs and we have reviewed it. The policy is ready and we are hopeful it will be ready by the first quarter of 2017,” said Obi.
The draft Regulation for Mini-Grids was created with the objective of accelerating electrification in areas without existing Distribution Network (“Unserved areas”) and areas with an existing but non-functional Distribution Grid (“Underserved areas”) by attracting participation of private sector, community based organizations, non-governmental organizations in achieving nationwide electrification.
The Regulation, which covers system with capacities below 5 MW, seeks to minimise risks associated with Mini-Grid investments especially in the rural areas by providing for tariff stability over long time.
It also provides for a fair compensation mechanism for stranded Mini-Grid Operator investments where main grid extends to cover the Mini-Grid area. It also provides for permit and tariff approval procedures which will ease the administrative burden on the Mini-Grid Operator and ensure the process of obtaining the Permit in a timely manner.
Public consultations had been held in Lagos, Enugu, Kaduna and Abuja and the response from stakeholders have been overwhelmingly positive.
Some corporates are positioning to take advantage of provisions of the regulation to generate 10,000MW starting next year.
They are particularly enthused with the provision that allows investors in embedded generation charge cost reflective tariff that are in line with MYTO and allows them recover cost and include a profit margin.
ISAAC ANYAOGU