Transcorp’s Abuja Electricity Distribution Company (AEDC), a leading distribution company linked to Nigerian businessman Tony Elumelu, has been sanctioned by the Nigerian Electricity Regulatory Commission (NERC) for breaching the recently enacted electricity tariffs in Nigeria’s capital city.
AEDC, a unit of Transcorp Power, the energy arm of diversified conglomerate Transnational Corporation of Nigeria Plc (Transcorp) led by Elumelu, faces penalties for violating the Supplementary Order to the April 2024 Multi-Year Tariff Order 2024.
NERC levied a N200-million ($0.468 million) fine against AEDC for incorrectly billing customers outside Band A – those exempt from the tariff increase – at the higher rates. The commission has mandated AEDC to reimburse impacted customers and implement proper billing procedures. On April 3, NERC increased tariffs for Band A customers receiving 20 hours of daily supply but clarified the adjustment wouldn’t apply to Bands B, C, D, and E.
Electricity tariff reform hiccup in Nigeria
Residents categorized under lower electricity consumption bands in Nigeria encountered unexpectedly high rates when purchasing pre-paid units following a recent tariff announcement. The Abuja Electricity Distribution Company (AEDC) attributed the issue to a “system glitch” stemming from the movement of Band A customers to Band B amidst power supply shortages. This incident highlights the ongoing challenges associated with electricity tariff reforms in Nigeria, where consumers face inconsistent power supply despite rising costs.
The Nigerian Electricity Regulatory Commission (NERC) issued a statement on Friday stating, “This decision follows a comprehensive review and analysis of customer feedback, which revealed that AEDC had incorrectly applied the new tariff to all customer bands. The Order was designed to ensure fair billing practices.”
The statement further elaborated on the reimbursement process, specifying, “AEDC will reimburse affected customers by providing the balance of electricity tokens they are entitled to receive at the applicable rates. All token reimbursements must be issued to affected customers by April 11, 2024.”
Elumelu’s leadership drives Transcorp’s success
Transcorp, a publicly traded Nigerian conglomerate with diversified holdings across hospitality, power, oil, and gas sectors, holds Transcorp Power, its energy division, at its core. The company’s mission emphasizes elevating living standards, driving positive change across Africa, and delivering sustainable value to its shareholders.
Tony Elumelu, a prominent Nigerian businessman, has significantly influenced Transcorp’s trajectory toward financial success. Through his investment firm, HH Capital, Elumelu holds a substantial 29.5 percent stake in Transcorp, representing 11,990,957,350 ordinary shares.
