Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Sola Arifayan
Partner
Ikeyi & Arifayan
Outline
∗ Performance and
evaluation
• Transparency in
Decision-making
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Context & Operational Principles [1]
The context for regulation
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Context & Operational Principles [2]
Context for regulation (contd)
Independence Transparency
Using
Using appropriate
appropriate
Consistent
Consistent
instruments
instruments in
in
behaviour
behaviour across
across
response
response to
to Nigerian Electricity
market
market participants
participants
changing
changing situations
situations Regulatory
Flexibility &
& over
over time
time
Commission Consistency
(NERC)
Consultation
Communication
Information
Information to
to
stakeholders
stakeholders on
on aa Participation
Participation of
of
timely
timely &
& accessible
accessible stakeholders in
stakeholders in
basis
basis the
the regulatory
regulatory
process
process 5
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Context & Operational Principles [4]
Maintaining the Principles
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Internal Factors [1]
Governance and operations
Broad representation in the Commission:
∗ Stakeholders (public, market participants, etc.)
∗ Different relevant professional skills and backgrounds
Appropriate balance between ‘internal’ and ‘external’ expertise
Well-defined and documented processes for decision making and
communication of decisions to stakeholders
Clear differentiation in the roles and responsibilities between
∗ Commissioners
∗ Management and staff
‘Freeing’ Commissioners from day-to-day operations and lower level
decision making
The electricity industry is highly complex and increasingly dynamic – NERC and
its staff must:
∗ understand the technical features of the industry
∗ draw on expertise in economics, finance and law
∗ understand the art as well as the science of regulatory decision-making
Key issues:
∗ size and skills-mix
− ratio of regulatory staff to number of service providers
− mix between administrative and professional staff
∗ NERC should be solely responsible for appointment and or dismissal of its staff: no
‘political’ appointments
∗ sector-specific experience of personnel
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Internal Factors [3]
Management & Staffing (contd)
Key issues:
∗ Serious capacity and investment shortfalls across all relevant sectors
∗ Managing the interface between other (existing and potential) regulators and
agencies
∗ Making and or complying with multiyear promises: less productive decisions on
uses of resources result from uncertainties about future regulation
∗ Ongoing political commitment to the process 11
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External Factors [2]
Regulatory environment (contd)
Key issues (contd):
∗ Chosen industry structure: can it sustain financially viable businesses:
- what is the level of certainty associated with revenue and costs?
- are the commercial arrangements necessary for financial viability sufficiently defined?
∗ General investment climate issues, e.g.:
- clearly defined and enforceable property rights
- the development of mature capital markets
- consistent and clear regulation of companies
- comprehensive competition policy and anti-trust measures
- independence and effectiveness of the judiciary;
- objective policy development and ongoing review
- facilitation of capital movements in and out of investments/countries;
- sound and well understood environmental policy
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External Factors [3]
Accountability and Reporting
Possible overlaps:
∗ BPE – privatisation of NBUs
∗ (Proposed) Anti-Competition Commission
∗ (Proposed) Gas Regulatory Commission, etc.
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The Regulatory Challenge [2]
Meeting the Challenges
Potential public NERC must discharge its Effective, timely and clear
disaffection with obligations in a way that communication of:
short term pains of builds public support for its regulatory decisions
the reform process role and decisions, and thus rationale for decisions
helps to sustain the reforms impact of decisions
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The Regulatory Challenge [4]
Meeting the Challenges (contd)
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Key challenge [1]
Closing remarks
NERC must:
∗ ensure adequate consumer protection
∗ set tariffs independently of political manipulation
∗ make transparent, consistent, credible and competent decisions
∗ regularly publish its decisions to create a reliable body of precedents
∗ create incentives to improve technical and financial performance
∗ oversee new, private investment in the sector
∗ contribute to expanded access to affordable services
∗ make and comply with multiyear promises
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