Four months after the Federal Government and the Nigerian Electricity Regulatory Commission (NERC) quietly ordered the removal of subsidy on electricity and increased end-user tariffs, orders released, yesterday, by the regulator have created fresh concerns as poor Nigerians are now heavily burdened by tariff increases.
Yesterday, six power distribution companies (DisCos) got NERC approval to increase tariffs. According to a document issued on December 29, 2021, and signed by Sanusi Garba, NERC chairman, and Musiliu Oseni, vice chairman, the new tariff took effect from February 2022.
Port Harcourt Electricity Distribution Company (PHEDC), Jos Electricity Distribution Company (JEDC), Kano Electricity Distribution Company (KEDC), Kaduna Electricity Distribution Company (KEDC), Ikeja Electricity Distribution Company (IKEDC) and Ibadan Electricity Distribution Company (IBEDC) are the six DisCos that NERC approved.
NERC said some of the indices considered for the tariff increase include gas price, inflation, exchange rate, U.S. inflation rate, and available generation capacity. It added that these indices shall be reviewed every six months to update the tariffs with changes in the indices as applicable in line with the multi-year tariff order (MYTO).
While the new tariff has about two to five naira increase for consumers under band A to C, the previously frozen band D and E, which the Federal Government had claimed was subsidised to reduce the burden on poor Nigerians now has over N5 increase.
This is coming a few days after NERC openly defended DisCos, saying they have been faced with inflation, foreign exchange challenges and insecurity leading to the inability to collect revenue.
Some stakeholders yesterday lamented that the tariff adjustment confirms earlier rumours that NERC had quietly increased end-user tariff, a development they see as a deception for the regulator to have approved and implemented the tariff increment since February but just published it in May. (Guardian)