The Management of Benin Electricty Distribution Company (BEDC) PLC, yesterday, January 31, explained that the its delay in signing the bilateral agreement on Edo State owned Ossiomo Power project was due to Ossiomo’s non agreement to process of operations, maintenance and management of the line being constructed in line with licensing and safety standard in order to ensure safety of lives and property.
The Management, however, affirmed it ready to partner Edo State government on the project, stressing that this is evidenced in its constant efforts at ensuring that the Nigerian Electricity Regulatory Commission (NERC) clearance letter is properly and safely implemented.
BEDC Chief Head, Edo State, Mr. Abel Enechaziam, while disclosing the company’s position to newsmen in Benin, said procurement process for the proposed new line, expected to be based on open & competitive procurement that is in line with prudency requirement by the regulators has not been agreed to by Ossiomo.
Enechaziam, who addressed the press on behalf of the Managing Director of BEDC, Funke Osibodu, noted that when combined with proposal by Ossiomo, the valuation methodology for pricing of purchase in 10years time should be agreed to in future, stressing that these can lead to tariff costs that may not conform with regulatory approval.
“As you are aware, we operate in a regulated sector andsector and would require the sign off of the relevant sector regulators such as NERC and NEMSA before executing the proposed agreement, in order to ensure that we remain within the permitted regulatory parameters”, he stressed further.
According to him, two grey areas that were in contention in the bilateral agreement on Ossiomo bordered on the need for valuation of the line being used for power evacuation through open, competitive and transparency tendering process to ensure that only prudent cost are passed to the customers.
The other area of dispute he said was the company’s insistence that joint operation and maintenance of the Ossiomo line was not allowed and that a sub contactor could be appointed by Ossiomo to work under BEDC supervision for accountability and safety sake in its network.
He stated, “The recent electrocution of two persons occasioned by Ossiomo’s ongoing construction which interfaced with our distribution line thereby causing supply interruption to the community in the area as well as alleged death of one of the parties involved, indeed emphasizes the need for the project to be undertaken in line with applicable regulatory and safety standards.”
He further noted that in addition, there were also other unresolved matters such as valuation methodology for line construction, as well as the issue of procurement of 33KV line, and the operation and maintenance of the constructed distribution line.
The Management therefore requested for the release of the draft agreement for its review and clearance by the regulator; considerations for safety of the lives of people and public costs so that there is need for proper alignment of key stakeholders and regulatory sign off on the agreement before execution.