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Edo, Delta, Ondo, Ekiti seek unbundling of BEDC, shareholder rights in board and management 

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BEDC Engineers

The state governments of Edo, Delta, Ondo, and Ekiti collectively referred to as “BEDC State Governments” have taken a formal step to communicate with the Nigerian Electricity Regulatory Commission (NERC), signalling their intention to assert their shareholder rights in the Benin Electricity Distribution Company (BEDC). 

They claim the initiative is a response to the “operational challenges and failures in service delivery” within their respective states. 

In a unified correspondence addressed to Engr. Sanusi Garba, the Chairman of NERC, dated March 18, the initiative launched by the states represents a pivotal move to address longstanding discrepancies stemming from the privatization process of 2013.

Sources with knowledge of the matter reveal to ThePressNG that the direct shareholdings of Delta and Edo State in BEDC is 14% and 8.4% respectively. Ondo and EKiti States also own 6.6% and 5.2% respectively in BEDC. The FG owns 5.8% giving the states and federal government a combined stake of 40%. 

On Expressing their Intent: The letter was written as a formal notification to NERC of the collective intent of the State Governments where BEDC operates regarding their residual equity in BEDC.

The State Governments expressed dissatisfaction with the operational deficiencies and service delivery failures of BED stating that the provision of reliable electricity is a core priority and essential for the welfare and development of their states’ populations.

On active board and management participation: They also expressed their intention to exercise their rights as shareholders to address these concerns. This includes an active role in decision-making at both the board and management levels to improve operations and service delivery, as well as to extend electricity access to unserved and underserved communities.

Addressing historical oversight: The also stated that their letter seeks to address what they see as a “historical oversight” as they have not given any Power of Attorney to the Federal Ministry of Finance Incorporated (MOFI) or the Bureau of Public Enterprises (BPE) concerning their shareholding post-privatization of BEDC.

Planned takeover of BEDC: They also noted  NERC’s intent to possibly take regulatory control of BEDC by March 31, 2024 and thus requested formal notification before any regulatory actions are taken, such as the appointment of new directors and a management team.

They also urged NERC to begin the process of unbundling BEDC along state boundaries, which implies a desire for more localized control over electricity distribution that aligns with state borders.

Sources familiar with the industry perceive this action as a critical first stride towards remedying the missteps of the past and steering the sector toward a more equitable and efficient future.

The letter from the state commissioners of power to the Nigerian Electricity Regulatory Commission (NERC) seems to be a direct and urgent response to the planned regulatory takeover of the Benin Electricity Distribution Company (BEDC).

This urgency is predicated on the controversies surrounding BEDC, which have seen a series of legal and corporate maneuvers.

The letter suggests that the state governments are seeking to exercise their powers, possibly buoyed by the new Electricity Act, which may offer them legal grounding to assert more influence over the operations of BEDC and, by extension, other DisCos.

An Industry stakeholder who spoke to ThePressNG stated that this newfound assertiveness can have far-reaching implications for the wider electricity sector.

It also represents a shift toward a more decentralized approach in managing Nigeria’s power sector, with state governments having a stake in ensuring the DisCos operate effectively within their jurisdictions.

BEDC is responsible for the retail distribution of electricity in Delta, Edo, Ekiti, and Ondo States with a geographical coverage of 57,353 square kilometres.

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