Electricity Consumer to Pay More in Nigeria

Why Nigerians May Pay More For Electricity- NERC

Despite the indication that electricity tariff will be reduced, the Nigeria Electricity Regulatory Commission (NERC), has reiterated electricity consumers may pay more.

At a stakeholders’ forum in Abuja comprising representatives of the Nigeria Electricity Supply Industry (NESI), generation companies (GENCOS), distribution companies (DISCOs) and Consumers’ Forum, the commission’s chairman, Dr. Sam Amadi, said tariff has dipped from N26 to N23per kilowatt.

“The good news is that the average tariff has come down from N26 to N23. That is the good news. For us, if it goes up, we say it goes up. If it goes down, we say it goes down.” he assured.

Though the commission intends to reduce tariff, The Nation reports that Amadi insisted customers will now pay more.

If the new tariff is approved, Amadi said R2 Abuja customers who presently pay N14 may pay N19.According to him, the new tariff ought to have commenced in July but was effected in June as Buhari-led government assumed office.

Due to the stability in the market, Amadi said it is now convenient to propose the increase in tariff.

As a result, the DISCOS are expected to present their different proposed tariffs to the commission which will be presented to the Presidency for approval.

“By January last year R2 customers were supposed to pay N19 in Abuja. They are paying N14. Today with the analysis, instead of N18, it should be N19. There is a reduction but it doesn’t mean that at the end of the day, they will still be paying that N18.” he explained.

As indicated by the commission, tariff review is influenced by gas prices, exchange rate, inflationary rate and generation capacity.

NERC’s principal manager, Market Competition and Rates, Aisha Mahmud, said that the data obtained from the website of the Central Bank of Nigeria (CBN) guided the commission in computing the bi-annual minor review.

The data indicated that the inflation rate as at April 30 this year was 8.3 per cent while the exchange rate was N197 to $1 as at the said date.

The gas price was also observed to have increased to $2.50 from $1.50 at transportation cost of $.80.

According to Mahmud, average peak daily generation capacity is now 3,832megawatts (Mw) while average energy sent out is 3,404Mw.

The commission explained that with the increase in energy generation, DISCOs now can generate more revenue hence justifies the reduction in the cost of power.