The Economic and Financial Crimes Commission on Wednesday arrested the Chairman of the National Electricity Regulatory Commission, Dr. Ransome Owan, and six commissioners in the agency over an alleged N5bn fraud.
Their arrests occured hours after a Federal High Court in Benin, Edo State, restrained 15 banks not to honour cheques issued by the Ondo State Government for some contracts.
Sources close to the EFCC said that Owan and the commissioners would remain at the EFCC headquarters in Abuja, until investigation was concluded.
When contacted on the telephone, the EFCC Spokesman, Mr. Femi Babafemi, sent a terse text message in which he wrote “confirmed.”
The Head, Media and Publicity of the agency, Mr. Michael Faloseyi, could not be reached as at 9pm on Wednesday for comment but a source in the NERC said, “All I can say is that they (Owan and the commissioners) were arrested by EFCC operatives at the close of work today(Wednesday).
The NERC is an electricity licensing and regulatory agency of the Federal Government that does not award contracts.
It was set up in 2006 following the enactment of the Electric Power Sector Reform Act, which envisaged the privatisation of the power sector.
Part of the agency’s mandate is to regulate the Power Holding Company of Nigeria units when they are privatised. It also regulates the Independent Power Projects.
So far, it has licensed 29 independent power producers, some of which are at various stages of developing their power plants.
Its source of funding is largely through Federal Government’s subventions and revenue from licensing IPPs.
Six of the commissioners arrested are from each of the six geo-political zones of the country.
Except the chairman, who has a five-year tenure, the commissioners serve for four years each.
The power sector had in the last one year been enmeshed in controversy and non-execution of contracts, which forced the House of Representatives Committee on Power to investigate the sector.
The committee’s report is yet to be debated by the House, just as the legislature noted that about $13bn was invested in the sector without any commensurate results.
Some former aides of ex-President Olusegun Obasanjo and governors were indicted by the committee in its report. The committee also recommended some contracts and individuals involved in the scam for further investigation by anti-graft agencies.
Despite poor electricity supply across the country, NERC approved a new electricity tariff known as the Multi-Year Tariff Order, which took effect on July1, 2008.
The Federal Executive Council on March 30, 2008 approved the scheme.
From N6 per kilowatt hour since 2002, the new tariff regime was pegged at N11 per kilowatt hour.
It will cost government N177.95bn to take care of the shortfall in tariff for the next three years.
Early in January, the Minister of State for Power, Nuhu Wya, had said that electricity generation would decide the 2011 elections.
The Federal Government is targeting the generation of 10,000 Megawatts by 2010 as against the current capacity, which is far below 3000 megawatts.
In Benin, the Federal High Court which restrained 15 banks holding the accounts of the Ondo State Government from honouring cheques issued by the state also stopped Governor Olusegun Agagu from awarding fresh contracts.
The court gave the orders while ruling on Tuesday on an ex-parte application filed by three applicants — Mr. Olawale James, Mr. Raymond Akadiri and Mr. Ibikunle Peters.
A copy of the Certified True Copy of the court order was made available to our correspondent in Akure on Wednesday.
Apart from the 15 banks, other defendants in the case included the state Accountant-General, the Attorney-General and Commissioner for Justice, the EFCC and its Chairman, Mrs. Farida Waziri.
The banks are Zenith Bank Plc, First City Monument Bank, Skye Bank, Diamond Bank, Unity Bank Plc, United Bank for Africa, Oceanic Bank, Stanbic IBTC Bank and Union Bank Plc.
Others are Intercontinental Bank Plc, Spring Bank, Guaranty Trust Bank, WEMA Bank, Access Bank and First Bank of Nigeria Plc.
The plaintiffs had in the ex-parte application prayed the court to order the EFCC to conduct investigations into various contracts awarded by the state government between August 2008 and January 2009.
According to them, the contracts awarded during this period included water transmission projects being handled by SCC Nigeria Limited at the Owena Multipurpose Dam which cost N14.4bn and payment of N3.8bn mobilisation fee to SCC Contruction Company through the FCMB, Akure branch.
Justice Chukwurah Nnamani adjourned the case till Friday.
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