Following their failures to submit audited financial reports for 2013 and 2014, Afam Power Plant Plc and Eko Electricity Distribution Company (EKEDC) have been fined N66, 600, 000 (Sixty Six Million, Six Hundred Thousand Naira Only) by the Nigerian Electricity Regulatory Commission (NERC).
Directive 162 of NERC found Afam Power in breach of its licensing terms and other operating conditions when it failed to file audited financial report for 2014 and subsequently liable to pay N18, 510, 000 (Eighteen Million, Five Hundred and Ten Thousand Naira Only) fine.
Similarly, Directive 163 found EKEDC in violation of its licensing terms and other operating condition over its late submission of 2013 and non-submission of 2014 audited financial reports. The company is, therefore, liable to pay N48, 090, 000 (Forty Eight Million and Ninety Thousand Naira Only) fine.
Both Directives signed by the acting Chairman, Dr. Anthony Akah, mni and General Manager, Legal, Licensing and Enforcement, Mrs Olufunke Dinneh expected the companies to pay their fines within two weeks beginning from December 9, 2016 when the Directives were signed.
The fines attract five per cent (5%) interest daily after the two weeks moratorium. The Commission may subsequently consider further disciplinary action against the erring electric power firms.
Failure by both companies to file their audited financial reports as and when due, according to Directives 162 and 163 violate Section 63 (1) of the Electric Power Sector Reform Act 2005; Conditions 4 (1) and 6 of their respective electricity generation and distribution licences.
Each ground of violation attracts N10, 000, 000 (Ten Thousand Naira Only) fine daily totalling N30, 000 (Thirty Thousand Naira Only) beginning from April 1, 2014 for 2013 financial reports for EKEDC and April 1, 2015 for 2014 financial reports for both Afam and EKEDC.
However, NERC in its Directives to Afam and EKEDC said both companies defied several overtures and reminders sent to them to file their audited financial reports for the periods under review but the reminders went unheeded.
Commenting further on the sanctions, the acting Chairman, Dr. Anthony Akah, mni, said, “The Commission would do whatever is required to ensure discipline in the Nigerian Electricity Supply Industry (NESI). It is only when stakeholders endeavour to play by the rules that we can begin to reap maximum benefits of the privatisation in the Sector.”
“We expect the operators to act in good faith and in line with the industry rules, standards and conditions for their licences as the Commission will not compromise on international best practices. Customers are also expected to fulfil their obligations to their service providers by paying their bills and not to engage in electricity theft”, he added.
Akah stated that all fines received by the Commission as a result of regulatory sanctions are to be transferred to Rural Electrification Fund in the line with the provision of the Electric Power Sector Reform (EPSR) Act 2005.
Non compliance of AFAM Power Plc - pdf (1.4Mb)
Non compliance of Eko Electricity Distribution Plc - pdf (1.04Mb)
Anthony Akah, mni,