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Audited Financial Report: NERC Fines Port Harcourt DISCO N37.5m

The Nigerian Electricity Regulatory Commission (NERC) over the weekend imposed N37, 520, 000 fines on the Port Harcourt Electricity Distribution Company (PHED) over its failure to submit audited financial report since 2013 when the new management came onboard.

The Commission in Directive 158 signed by the Acting Chairman, Dr. Anthony Akah, mni, and General Manager, Legal Licensing and Enforcement, Mrs Olufunke Dinneh, said that PHED has consistently flouted its licensing conditions which require it to submit yearly audited financial report and that subsequent reminders from the Commission to obey this licensing conditions was unheeded.

NERC in the Directive said that PHED has flouted at least four of its licensing conditions for failing to submit two years financial reports. Each of the four grounds of infringement attracts N10, 000 fines per day beginning from April 1, 2014 when the offences were first brought to the utility firm’s attention.

The Directive mentioned four infringements committed by Port Harcourt Electricity Distribution as, “For failing to comply with the licence terms and conditions, and other regulatory instruments, which is a breach under Section 63 (1) of the Electric Power Sector Reform Act 2005, PHED is hereby fined Ten Thousand Naira per day, from April 1, 2014.”

“For failing to comply with Condition 6 (7) of the Electricity Distribution Licence terms and conditions granted PHED by the Commission, PHED is hereby fined Ten Thousand Naira from April 1, 2014 till the date of this Directive.”

“For failing to comply with Conditions 23 (1) of the Distribution Licence Terms and Conditions granted PHED by the Commission, PHED is hereby fined Ten Thousand Naira per day from April 1, 2014.”

The company was further sanctioned “For failing to provide the Commission with the requested financial information, which is a breach under Condition 4 of the Distribution Licence Terms and Conditions” and it is hereby fined Ten Thousand Naira per day from April 1, 2014. The fines run concurrently from April 1, 2014 being the date the first financial report was due.

Directive 158 further stipulates that the N37, 520, 000 being the total fine sum should be paid within two weeks counting from October 24, 2016 when Directive 158 was signed.

However, the utility company is expected to comply with the submission of its financial report within the stipulated time besides paying the fine sum within two weeks after which the fine runs at five per cent interest rate until it is liquidated.

It may be recalled that Port Harcourt Electricity Distribution Company alongside another electricity firm were in June 2016 sanctioned over their failure to comply with the Nigerian Electricity Commission’s Forum directive on customer complaints.

Commenting on the development, Dr. Akah said, “the Commission expects operators in the power sector to play by the rules” and that the Commission will continue to provide enabling environment for them as much as it will ensure that the rights of electricity customers are not violated.

Dr. Usman Abba Arabi - Head, Public Affairs Department
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