Electricity firms push for 100% tariff hike

Posted by News Express | 12 July 2016 | 2,292 times

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Power firms are pushing for a fresh 100 percent increase in electricity tariff, the second in six months, Daily Trust investigations have shown.

The electricity distribution companies (DisCos) raised tariff by over 45 percent in February.

The DisCos had written to the regulatory authority, the Nigerian Electricity Regulatory Commission (NERC) demanding hike in tariff from the current average of N24 per kilowatt (for residential consumers) to N50 per kilowatt.

However, the Director General of the Manufacturers Association of Nigeria (MAN), Mr Remi Ogunmefun, told Daily Trust in Lagos that his association had opposed that move in writing to the NERC.

The NERC announced the 45 percent hike in electricity tariff with effect from February 1, 2016, and said the increase would enhance service delivery and customer satisfaction.

But since the increment, the electricity supply across the country has dropped affecting both household and commercial activities.

A source at the NERC confirmed that the DisCos had written a letter seeking for the increase.

“When MAN got wind of the power firms’ letter seeking for the 100 percent hike, they equally wrote a letter countering the DisCos claims,” the source said.

The spokesperson of NERC, Mike Faloseyi, when contacted on Sunday, said he was not aware of the proposed hike but promised to get back to our reporter. When Daily Trust contacted him yesterday, he said he was in a meeting but would consult with the commission chairman and get back to us. But he never did.

Power firms justify tariff

It was observed that in an attempt to justify its proposed electricity hike, the umbrella body for DisCos, the Association of Nigerian Electricity Distributors (ANED) has been running advertisements in about 10 national dailies in the last five weeks highlighting “basic electricity facts the public must know.”

The publicity messages, ANED said, were meant to clarify the position of 11 power distribution companies in the power sector value chain.

Some of the paid publications carried messages such as: “Electricity is a commodity with a price that must be paid.”

“The average residential tariff of N24.12/kWh is still significantly cheaper than self-generated power at a cost estimated to be in excess of N50/kWh,” among others.

ANED on its website also said the DisCos had a five-year performance commitment to reduce power interruption, extend the distribution network, increase metering and improve the quality of customer service.

One other message by the association reads: “DisCo operators only collect 24 percent of the tariff revenues. The balance goes upstream to transmission, generation and other industry stakeholders (CBN, NERC, NBET, etc).”

The association said without a tariff that allowed the operators to recover their cost of operation, there would be no increased generation or improved service delivery.

On the recent vandalism, ANED in its most recent series of paid publicity said electricity customers should blame vandals and not the DisCos as “we cannot give what we do not have.”

•Excerpted from a Daily Trust report. Photo shows electricity grid.

Source: News Express

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