Ghana: GRIDCo Laments Over How ECG’s Non-Compliance To Load Management Instruction Threatened Grid….But ECG Denies Claim
Ghana’s power transmission company and system operator, Ghana Grid Company Limited (GRIDCo), has detailed how the power distribution company responsible for power supply in the southern Ghana, ECG, disregarded its instruction which posed significant risk to the power stability across the country.
According to GRIDCo, the non-compliance to its instruction by ECG compelled it to take feeders out of service to prevent system collapse.
In a letter to Dr Matthew Opoku Prempeh, Energy Minister of the Republic of Ghana, and signed by the CEO of GRIDCo, Ing Ebenezer Kofi Essienyi cited instances where ECG engineers refused to comply with GRIDCo’s load management instructions.
The letter stated that on March 20, 2024, Peak Hours the National System Control Center (SCC) had to take Tafo Feeders out of service due to ECG’s failure to properly implement load management instructions.
GRIDCo said this resulted in a system frequency drop to a critical level of 49.47Hz.
GRIDCo said similar thing happened on March 21, 2024, during Peak Hours when ECG refused to comply with its instructions. This forced the National System Control Centre (SCC) to disconnect feeders in Tema, Winneba, Kasoa and Kumasi.
“This action was taken to prevent system collapse after the frequency dropped to a concerning 49.29Hz,” GRIDCo said..
“When these emergency disconnections occur, ECG publishes customer notices attributing the loss of power supply to GRIDCo, which is not an accurate description of the current situation. Furthermore, ECG’s disregard for load management instructions is a clear violation of the regulations.”
As a result, GRIDCo urged the Minister to intervene to ensure ECG complied with the issuance of a load-shedding timetable.
“We, therefore, bring this to your kind attention, Honourable Minister, and seek your urgent intervention to ensure cooperation from ECG with respect to load management operations,” GRIDCo said.
However, ECG has responded to GRIDCo’s concerns and expressed shock that GRIDCo portrayed it as uncooperative.
ECG in a letter signed by its Managing Director Samuel Dubik Mansubir Mahama and forwarded to the Energy Minister sighted by Myjoyonline, ECG provided detailed statistics on load management requests received from GRIDCo between January and March 2024, demonstrating instances where requests were received shortly before peak or off-peak periods, limiting ECG’s ability to plan and inform customers adequately.
“It is a fact that GRIDCO routinely directs ECG’s System Operators to drop load at some of our Bulk Supply Points (BSPs), but the issue has been the inadequacy between the time these requests are received and the time these requests must be effected to sustain the integrity of the power system and also for ECG to inform its customers.
“It worthy to note that, between January and March 2024, sixty-four (64No.) requests were received from GRIDCo for load management. Out of this, forty (40No.) were for peak periods (18:00 – 24:00 hrs) and twenty-four (24No.) for off-peak (06:00 – 18:00 hrs) load management.
“Out of the forty (40no.) peak load requests, thirty-five (35No.) (88%) of them were received within an hour to the peak period. There were only five (5No) (12%) instances where ECG received the request within 2-3 hours of the peak period.
“Out of the Twenty-Four (24No.) off-peak load requests, three (3No) (13%) of them were received within 30 minutes to the off-peak period while the remaining Twenty-One (21 No.) (87%) instances were received far into the off-peak period,” portion of the letter reads.
Source: https://energynewsafrica.com
Zambia: Zesco Continues Staggered Load-shedding In Parts Of Lusaka
Zambia’s power utility company, Zesco Limited, has entered week two of the staggered eight-hour daily load-shedding for some residential areas in Lusaka, the capital of Zambia.
The company began the staggered load shedding exercise in Lusaka effective April 1.
According to the power distribution company, the affected residential areas will experience two power outages of four hours each, spread throughout the day.
In a statement issued by Matongo Maumbi, spokesperson for Zesco Limited on Monday, April 8, it said the rest of the country, including industrial, commercial and farming areas, remain on the 8-hour straight load shedding since 11 March 2024.
The aim of the load-shedding is to minimise disruption and ensure grid stability due to low generation capacity.
The Southern African nation has an installed generation capacity of 3356.6MW.
This capacity comprises of 83 percent of hydro, nine percent of coal, five percent of heavy fuel oil and three percent solar PV.
The mining sector remains the largest consumer of power at 51 per cent of total generated electricity, followed by the domestic sector at 33 per cent.
Source: https://energynewsafrica.com
Nigeria: Power Sector Workers Union Kicks Against Tariff Hike … Threatens Industrial Action
Power sector workers in the Federal Republic of Nigeria have raised objection to the recent increase in electricity tariff for Band A category consumers.
The tariff has seen a significant jump from N66 per kilowatt hour (kWh) to N225 kWh.
The power sector workers, under the aegis of the National Union of Electricity Employees (NUEE), want immediate reversal of the tariff, warning that failure to do so would potentially lead to the laying down of their tools.
In a press statement, the National President of NUEE, Adebiyi Adeyeye, condemned the decision by the Nigerian Electricity Regulatory Commission (NERC) to raise tariffs for customers enjoying extended power supply (Band A classification).
Adeyeye argued that the increase would unfairly burden Nigerians who rely heavily on electricity, particularly low-income households.
He emphasised the widening inequality this price shift would create, stating, “This decision blatantly disregards the economic struggles of Nigerian workers, especially considering the uncertain minimum wage situation.”
He challenged the notion that electricity subsidies are inherently negative.
“Subsidies are not alien even in advanced economies,” Adeyeye said, citing Germany’s support for renewable energy and the low-income household assistance programmes by the US.
They vowed to protect their members who would otherwise be forced to implement the new tariffs on Nigerians.
Adeyeye urged the public to join their cause, stressing, “Together, we can compel the government to prioritise the well-being of its citizens over corporate interests.”
The union reiterated their commitment to safeguarding their members’ interests and ensuring equitable access to electricity for all Nigerians.
Source: https://energynewsafrica.com
Russian-Controlled Zaporizhzhia Nuclear Reactor Damaged After Drone Attack
The Zaporizhzhia Nuclear Power Plant (ZNPP) in Ukraine was damaged Sunday in a drone attack, the United Nations’ energy watchdog said, as both Russian and Ukrainian officials denied responsibility for the strike and accused the other of carrying it out.
The International Atomic Energy Agency (IAEA) reported the attack at the Russian-controlled facility, but said the damage “has not compromised nuclear safety.”
The drone attack included three direct hits against the facility’s main reactor containment, the agency’s director-general, Rafael Grossi, said on X.
“One person died as a result of the attack,” he added.
“This is a clear violation of the basic principles for protecting Europe’s largest (nuclear power plant). Such reckless attacks significantly increase the risk of a major nuclear accident and must cease immediately,” Grossi said.
Russian authorities accused the Ukrainian military of carrying out a series of attacks against the plant using “self-exploding” drones, according to a statement posted on ZNPP’s official Telegram channel.
But Ukrainian officials denied responsibility and accused Russia of endangering the nuclear facility and surrounding population.
“The incidents at ZNPP are also a form of Russian nuclear blackmail aimed at both Ukraine and the international community,” a Ukrainian government agency said Monday.
Kremlin spokesman Dmitry Peskov on Monday condemned Ukraine’s denial of involvement and said the drone attack is “a very dangerous practice that has very bad, negative consequences.”
A truck unloading food was damaged, and another hit was registered in the cargo port area of the facility, according to the ZNPP statement.
“Shelling of Zaporizhzhia NPP and its infrastructure is unacceptable. No nuclear power plant in the world is designed to withstand full-fledged fire from the armed forces.
Damage to infrastructure facilities may affect the safe operation of the NPP,” the statement added, using an acronym for the nuclear power plant.
Following Russia’s accusations, Ukraine denied any involvement in the attack, the spokesperson for the Defense Intelligence of Ukraine, Andriy Yusov, told Ukrainian news outlet Ukrainska Pravda.
“The aggressor state is once again endangering the nuclear facility, civilians and the environment of the whole of Europe,” Yusov said, according to Ukrayinska Pravda.
Source: CNN
Ghana: Transmission Lines Reliability Increased By 50% In Parts Of Western Region
The Electricity Company of Ghana (ECG) has collaborated with Genser Energy, a prominent Ghanaian energy company operating in the Western Region of Ghana, and taken steps to ensure power supply reliability in parts of the Western Region.
Poor electricity supply in parts of the region, especially at Wassa Old Subri, has become a major concern for the chief of the community, Nana Twumasi Ampaakwaw II, since the year 2022.
“Every day while leaving our farms, we feared that we would come back home to see no lights because a tree had fallen on the lines,” the chief said recently.
These trees have been progressively growing, posing a threat to the community’s power supply.
This power is not only vital for functioning healthcare facilities but is also essential for sustaining businesses and schools in the area.
In response to these pressing concerns, ECG has undertaken significant measures over the past three months to enhance transmission reliability.
Earlier this year, ECG partnered with Genser Energy, which is known for providing affordable and reliable power to various sectors, including mining giants like Gold Fields and Golden Star.
An assessment conducted earlier this year identified numerous trees and plantations under the transmission lines within the allowable distance.
These vegetation clusters posed a significant risk by disrupting power supply to 58 communities reliant on electricity transmitted through these lines.
To ensure community participation and support, Genser Energy engaged over 200 stakeholders, including traditional leaders, local assembly members, and project affected persons (PAPs).
The maintenance work did not only create local employment opportunities but also it provided compensation to farmers whose trees needed removal.
Genser Energy community relations team worked closely with local leaders and residents to ensure that the project not only enhanced power reliability but also contributed to the welfare of the community.
Justice Kofi Yeboah, a PAP from Accra Town, expressed his gratitude towards ECG and thanked Genser Energy for providing employment opportunities and improving community safety.
He also expressed his satisfaction with the project, indicating that the clearing works would help the entire community and his family.
“The clearing helps us all; if my son comes to my cocoa farm, I’m now rest assured that the lines will not interfere with the cocoa trees and harm his life,” he stated.
Under the supervision of the Genser Energy Construction Superintendent, Stephen Ayisi, teams selectively trimmed tree branches and removed high-risk trees that posed a threat to the transmission lines. Local recruits from the affected communities were actively involved in these operations.
Since the clearing, the communities have enjoyed an improvement in power supply to the communities. There has been a 50% reduction in power surges that caused power cuts in these communities between January and March this year, due to the cleared vegetation along these lines.
Samuel Acheampong, Mmratehene of Koduakrom stated, during a public engagement with Koduakrom PAPs, that “the only work we do here is farming and petty trading. If this project has employed our youth to gain skills beyond what we do, then I am happy Genser has made that possible.”
The removal of high-risk trees will not only enhance the reliability of electricity supply to essential facilities but also contribute to the overall stability of Ghana’s national grid. Beyond local gains, protecting the lines enhances overall stability of Ghana’s national grid.
Source: https://energynewsafrica.com
Saudi Aramco Suspends Two Oil Contractors
Aramco has served notices of temporary suspension to two oilfield service contractors, Zawya has reported, citing the companies.
According to one of them, Borr Drilling Limited, the suspension will begin this month and last for a year, the report said. Borr Drilling operates the Arabia I rig in Saudi Arabia and said it would look to move the rig elsewhere for the duration of the suspension.
The other company, Valaris, has also received a suspension for one rig, out of a fleet of 19 that its Saudi subsidiary operates in the kingdom. The contract for the rig was ending at the end of this year, the report noted.
Aramco earlier this year said it had scrapped plans to expand production capacity to 13 million barrels daily. The company said in January that the state had ordered it to stop work on the capacity expansion and keep the maximum sustainable capacity at 12 million bpd.
The expansion plan was announced back in 2021 and it was supposed to be completed by 2027. Since then, however, price movements have not always been in a favorable direction for Aramco and its owners.
In reaction to the price slump from 2023, the Saudis and their partners in OPEC+ affected additional production restrictions, which are already bearing fruit, especially in combination with Middle Eastern tensions that traditionally have a bullish effect on prices.
A month later, Italy’s Saipem said that it expected the decision to result in 20% lower orders from the Saudi giant.
Meanwhile, Aramco officials have on numerous occasions warned that the world’s oil production capacity is insufficient in light of expected demand trends, and more investment was needed to ensure a balance between demand and supply.
In February, Aramco’s chief financial officer said that Due to the natural decline in operating fields, as many as 6 million barrels per day of global oil production is being lost every year and needs to be replaced—which was not happening.
Source: Oilprice.com
Tanzania Receives New SGR Electric Trains From South Korea
The Tanzania Railway Corporation (TRC) has announced the arrival of the first ever Electric Multiple Unit (EMU) trains at the Dar es Salaam port, marking a significant leap forward for the country’s Standard Gauge Railway (SGR) project.
This initial set consists of five electric locomotives and three passenger cars, offering a glimpse into the future of passenger transportation in Tanzania.
These state-of-the-art EMUs, purchased from Hyundai Rotem in South Korea, boast impressive features designed for comfort and convenience.
Each train can accommodate up to 589 passengers, whisking them along at speeds of up to 160 kilometers per hour.
The new units have prioritized passenger comfort with amenities such as Wi-Fi, designated seating for passengers with special needs, air conditioning, and CCTV cameras for enhanced security.
In a statement, TRC said they expect to receive a total of 10 EMU sets, with the remaining units arriving monthly until October 2024. Additionally, they have already received 65 passenger cars and 9 electric locomotives, further bolstering their fleet.
The arrival of this rolling stock signifies a major milestone for the SGR project. Phase 1, which covers the route from Dar es Salaam to Morogoro (300km) is at 98 percent, Morogoro to Makutupora at 96 percent, Makutopora- Tabora is at 13.98 percent, and Tabora- Isaka at 5.44 percent
While other sections are at various stages of development, with Mwanza to Isaka showing significant progress at 54.01 percent completion, the entire project is expected to be finalized by 2025. Source: NTV KenyaSenegal: President Faye Announces Oil, Gas And Mining Sector Audit
Senegalese newly-elected President Bassirou Diomaye Faye has indicated the readiness of his administration to conduct an audit of the oil, gas and mining sectors.
He said this last week while also reassuring investors they were welcomed to the country.
Faye defeated the ruling coalition’s candidate in a March election by a landslide, reflecting high hopes for change in the country with about eighteen million votes.
The audit is one of the first policy moves announced since the 44-year-old former tax inspector’s inauguration last Tuesday.
“The exploitation of our natural resources, which, according to the constitution, belong to the people, will receive particular attention from my government,” he said as reported by Reuters.
“I will proceed with the disclosure of the effective ownership of extractive companies (and) with an audit of the mining, oil, and gas sector.”
Source:https://energynewsafrica.com
Zambia: Our Collective Wisdom, Resources Should Benefit Africans -Zesco Board Chairman
ZESCO Limited Board Chairman, Vickson Ncube has urged the Southern African Power Pool (SAPP) Executive Committee to utilise the vast natural resources the continent is endowed with to better the lives of Africans.
Speaking on Thursday, 4 April 2024 at the official opening of the 56th Executive Committee Meeting of the Southern African Power Pool (SAPP) held at Ciêla Resort and Spa in Lusaka, Mr. Ncube observed that despite enjoying vast swaths of natural resources, the continent continues to grapple with social-economic challenges.
“Our forefathers; the founders of our countries had this great vision of integrated Africa where our collective wisdom and resources are working for the benefit of our continent. But allow me to mourn a bit because we have not realised that vision. Our economies are still defined by weathers and climate and everything else. We mourn about too much rain and about drought. We mourn about the heat and the cold,” he noted.
The Board Chairman observed that Africa had distinguished Engineers, Accountants, and Economists who should be at the centre of galvanising solutions to the challenges facing the continent.
“This meeting represents a greater agenda as defined by the African Union. The Africa we want is integrated, peaceful, and prosperous driven by its own citizens representing a dynamic force in the international agenda. We need solutions to our loadshedding problems; We need solutions to problems facing Africans. SADC as an organization becomes a very important building block towards the achievement of an integrated Africa,” Mr. Ncube said.
Meanwhile Mr. Ncube expressed happiness with the continued integration of Power Pools across the continent.
“May I recognise the partnership that is developing not only in the SAPP but also Zambia working with East Africa Power Pool through the Zambia-Tanzania-Kenya interconnection pool. I am praying that one day every African country will have an interconnector so that at a short notice we are able to evacuate power from one net surplus country to net deficits to keep our economies running.”
He added that it was the obligation of Africans to create a continent that is self confident in its identity, heritage, culture, values, and an influential partner in the global stage making its contribution to peace, and progress.
Currently, the SAPP comprises 17 power utilities from 12 Southern African Development Community (SADC) countries with the Republic of Zambia as the outgoing Chair of the organ.
ZESCO partnered with Lunsemfwa Hydro Power Company, Ndola Energy Limited, and the Copperbelt Energy Corporation Plc as co-hosting utilities, while the Zambia National Commercial Bank, ABSA Bank Plc, GreenCo, NR Electric Co. Ltd, and Maamba Collieries Limited are on board as meeting sponsors.
The Executive Committee is the second organ of the regional power market and is constituted of chief executive officers of the SAPP member power utilities.
The Committee meets bi-annually to deliberate strategic matters relating to the operations of the regional body. ZESCO Limited Managing Director, Eng. Victor Benjamin Mapani is former chairperson of the EXCO, a role he assumed in 2022.
Source: Zesco Limited
South Africa:Eskom Attributes Reduced Load Shedding To Investment In Plant Maintenance
South Africa’s power utility company Eskom has attributed recent stable power supply to investment it made in repairing the firm’s most problematic power stations.
The country has enjoyed nine days power supply without rolling blackouts.
A report by Sabc which quoted Eskom’s spokesperson Daphne Mokwena said the situation looks set to continue indefinitely except on the days that reserves have to be replenished.
Mokwena detailed why load shedding has stopped for now.
“We have experienced nine days without load shedding and we’re saying obviously we continue with that. In October, we did mention that we have implemented what we called the generation operational recovery plan, wherein that there are focused priority stations that we are looking at to ensure that we improve in terms of how they perform or their reliability.”
Mokwena adds, “So, we’re going to see more of these days, although we’ll have obviously some of the days where we need to recover either our emergencies and still continue with our maintenance but the future is looking very good in terms of the less intense and less frequent load shedding.”
Source: https://energynewsafrica.com
Ivory Coast: Eni Unearths Hydrocarbon Potential In Four Oil Blocks
Preliminary exploration conducted by Italian oil and gas major Eni has revealed promising signs of hydrocarbons in offshore oil blocks CI-504, CI-526, CI-706, and CI-708 in Ivory Coast.
The government has therefore agreed to proceed with negotiations for production sharing contracts with the firm.
An expression of interest was made by Eni in February 2024 for the offshore blocks.
This development follows Eni’s commencement of oil and natural gas production from the deepwater Baleine field in southeast Ivory Coast in August 2023.
The Baleine field boasts substantial reserves estimated at 2.5 billion barrels of crude oil and 3,300 billion cubic feet of natural gas, positioning it as the largest hydrocarbon discovery by an oil company in Ivory Coast.
Source: https://energynewsafrica.com
Ghana: New ECG Board Chairman Sworn Into Office
The Minister for Energy, Dr. Matthew Opoku Prempeh on Thursday, 4th April, 2024, swore-in newly appointed Board Chairman of the Electricity Company of Ghana, Hon. Herbert Krapa at the Ministry of Energy.
Hon. Krapa took the oath of office and the oath of secrecy as administered by the Energy Minister.
The appointment of Herbert Krapa, according to the Minister sends the clearest indication of the President’s renewed interest in the affairs of the company and therefore the need for a commensurate culture of accountability, professionalism, and innovation within the ECG.
“We are all privy to the challenges that have plagued the company, almost making it for some, not even fit for purpose. However, for some of us, including, most importantly, the President of the Republic, we believe we must continue on a path of ensuring that the company lives up to its billing” the Minister said.
He continued “I urge you, Chairman, to reflect deeply on the trust and expectations placed upon you by the President of the Republic. Your foremost duty is to justify this confidence through your actions and leadership. You are acutely aware of the vexed matters and therefore have no doubt that, you will, with the necessary support, stem the tide”
On his part, Hon Krapa who is also a Deputy Minister for Energy assured of his unflinching desire to lead the company with integrity, transparency, and a relentless focus, on delivering value to the Ghanaian people.
“His Excellency the President has given a very unequivocal indication of his resolve to ensure an ECG that will be formidable to keep the lights on and I am determined to actualize this vision of the President, of course with the support of my Minister” he said.
Source: https://energynewsafrica.com
Source: https://energynewsafrica.com Nigeria: NERC Slaps Abuja DisCos N200 Million For Violation and Misapplication Of New Tariffs
The Nigerian Electricity Regulatory Commission (NERC) has slapped Abuja Electricity Distribution Plc (AEDC) with a hefty fine of two hundred million Naira (NGN200,000,000) for failing to adhere to its tariff guidelines, creating a stir among consumers and industry stakeholders alike.
The fine comes in the wake of the Supplementary Order to the Multi-Year Tariff Order for 2024, issued on April 3, 2024, which AEDC has been found in violation of.
In a detailed correspondence released by NERC and seen by this publication, it was revealed that AEDC improperly applied an approved tariff increase across all customer bands, contrary to the specific directive that only customers in Band A were subject to the rate hike.
The oversight has not only led to undue charges for customers in Bands B to E but has also called into question the operational compliance and fairness standards maintained by one of the country’s leading electricity distribution companies.
The regulatory body’s supplementary order had initially set out to adjust tariffs in a manner that would not unduly burden the vast majority of electricity consumers, particularly those not in Band A.
However, AEDC’s misapplication of the new tariffs has breached the trust of its consumer base and contradicted the principles of transparency and equity that form the cornerstone of Nigeria’s electricity regulatory framework.
As part of its remedial directives, NERC has mandated AEDC to reimburse all affected customers in Bands B, C, D, and E through the provision of balance tokens reflective of the rates they should have been charged.
This remedial action is expected to be complied with immediately, therefore providing relief to thousands of consumers who were wrongfully overcharged.
Moreover, NERC’s directive requires AEDC to present evidence of compliance with these corrective measures by April 12, 2024, emphasising the urgency with which the regulatory body seeks to address and rectify the oversight. Failure to meet these requirements could lead to further regulatory actions, underscoring the seriousness with which NERC is approaching this breach of regulatory compliance.
This incident brings to light the challenges facing Nigeria’s electricity sector, highlighting the critical need for strict adherence to regulatory orders designed to safeguard consumer interests and ensure the fair administration of energy services.
As the NERC continues to monitor the situation closely, the outcome of this enforcement action is being watched by industry observers as a test of the regulatory framework’s effectiveness in maintaining discipline and fairness in the country’s evolving electricity market.
Source: https://energynewsafrica.com
Ghana: ACEP Pushes OMCs, LPGMCs To Go To Court Over NPA’s New Petroleum Pricing Guidelines
The Africa Centre for Energy Policy (ACEP), one of the think tanks in the Republic of Ghana, has asked oil marketing companies (OMCs) and liquefied petroleum gas marketing companies (LPGMCs) to take legal action against the National Petroleum Authority (NPA) over the implementation of the amended petroleum pricing guidelines.
ACEP said it is dismayed by the decision taken by the NPA.
According to the think tank, the directive is expressly outside the plethora of functional activities prescribed by the NPA Act (Act 691), 2005.
ACEP asserts that most of the legally mandated functions of the NPA are outdated in the current deregulated market context, yet sustained by political settlement to levy petroleum consumers and the industry unnecessarily.
The new pricing guidelines, among other provisions, set a price floor for petroleum products below which OMCs and liquefied petroleum gas (LPG) firms cannot price their products – a move which has triggered opposition from industry players.
“ACEP remains committed to advocating for a well-regulated downstream sector that prioritises competition, product quality, and consumer protection. We urge OMCs and LPGMCs, who are committed to an improved and cost-effective service delivery, to fight such illegal regulations and proceed to court to avert regulatory sabotage of genuine business efforts. ACEP will support any such challenge and demand accountability from the NPA in the public interest,” a statement released by ACEP said.
Full statement
ACEP is dismayed by the National Petroleum Authority’s (NPA) recent directive introducing price floors for the downstream petroleum sector.
The directive is expressly outside the plethora of functional activities prescribed by the NPA Act (Act 691), 2005. ACEP asserts that most of the legally mandated functions of NPA are outdated in the current deregulated market context yet sustained by political settlement to levy petroleum consumers and the industry unnecessarily.
ACEP argues that the NPA’s decision reflects a deepening of regulatory failure to effectively protect the consumer and the industry, which has crystallised in the:
Influx of illicit products through approved and unapproved routes on the market
Influx of substandard products on the market Stealing of tax revenue by some Oil Marketing Companies (OMCs) Burdensome passthrough levies and charges to the consumer Anti-competitive behaviour, including price undercutting, which NPA thinks can be resolved by implementing price floors.
Rather than addressing the aforementioned challenges, the NPA is opting for a “lazy” solution that rewards inefficiency, discourages competition and punishes the consumer at the pump. Setting price floors creates a system that benefits OMCs and Bulk Oil Import, Distribution, and Export Companies (BIDECs), which have weaker market presence and are struggling to sell volumes at competitive rates.
This protectionist policy is detrimental to creativity and competitive business strategy and ultimately harms consumer welfare.
Curiously, the regulator admits that substandard products are in the market and some players are undercutting prices. This is an apparent supposition that the NPA knows the players that are violating ethical conduct.
Why they prefer to skirt around the issues and introduce protectionism is intriguing, even to the extent of creating potential windfalls for the merchants of the illicit substandard products.
ACEP urges the NPA to prioritise progressive regulatory functions. This entails a more targeted approach that enforces progressive rules and sanctions companies engaging in unfair practices by employing data-driven approaches focused on identifying and eliminating anti-competitive behaviour without undermining business creativity and cutting-edge strategies that benefit the consumer. This will foster a fairer market environment for consumers and businesses in the long run.
It is time for the NPA to realise that sustaining 200 OMCs and 30 BIDECs cannot be at the expense of the consumer. The excessive appetite for regulatory fees to sustain their growing staff is impeding the organisation’s creativity and efficiency. Currently, 15 percent of registered
OMCs supply 90 percent of the market. Over 160 OMCs supply only 10 percent of the market but pay the required regulatory fees. Businesses must survive in the downstream sector on the merits of their business acumen and not on the basis of the NPA’s wishes.
ACEP remains committed to advocating for a well-regulated downstream sector that prioritises competition, product quality, and consumer protection. We urge OMCs and BIDECs, who are committed to improved and cost-effective service delivery, to fight such illegal regulations and proceed to court to avert regulatory sabotage of genuine business efforts. ACEP will support any such challenge and demand accountability from the NPA in the public interest.
End.
Signed
Kodzo Yaotse
Policy Lead, Petroleum & Conventional Energy
Source: https://energynewsafrica.com