Electricity consumers in the country have condemned the latest increase in tariff by the Nigerian Electricity Regulatory Commission (NERC).
In his reaction via social media, the President, Nigeria consumers Protection Network, Kunle Olubiyan said even going by the N24 /Kilowatt hour tariff announced in August, Nigerians were made to pay for Padded Cost of Electricity.
“He said, “The tariff that we had in August 2020 was heavily loaded with padded cost of production to cost inefficiencies. What it means is that Nigerians, even at N24 /Per Kilowatt Hour, were made to pay for Padded Cost of Electricity Tariff per Kilowatt Hour.
“We are shocked and taken aback by the latest development.”
A revised Multi Year Tariff Order (MYTO) signed by the new Chairman of NERC, Engr. Sanusi Garba, on December 30, 2020, and sighted Tuesday indicated over 50 per cent tariff hike payable by customers of customers of Ibadan DisCo with effect from 1st January , 2021, even as the commission said this latest order supersedes the previous Order NERC/2028/2020.
In the new Order NERC/225/2020, the commission said it considered the 14.9% inflation rate rise in November 2020, foreign exchange of N379.4/$1 as of December 29, 2020, available generation capacity, US inflation rate of 1.22% and the Capital Expenditure (CAPEX) of the power firms to raise the tariff.
The revised Service Based Tariff (SBT) also saw increase in the rates payable by all classes of electricity users unlike the one of November 2020, that exempted low power getters.
This is effective till June 2021 while a Cost Reflective Tariff (CRT) expected to raise the new cost higher will be activated from June to December 2021, the NERC Order revealed.
However, the commission has denied approving 50 per cent increase in electricity tariff with effect from 1st January, 2020.
The disclaimer was contained in a statement issued by the regulator yesterday after media reports that the commission had increased the tariff by 50 per cent triggered public consumers outcry and condemnation.
“The Commission hereby states unequivocally that NO approval hos been granted for a 50% tariff increase in the tariff order for electricity distribution companies with effect on January 1, 2021.
“On the contrary, the tariff for customers on service bands D & E (customers being served less than an average of 1 2hrs of supply per day over a period of one month) remains frozen and subsidised in line with the policy direction of the federal government.
“In compliance with the provisions of the Electric Power Sector Reform Act (EPRSA) and the nation’s tariff methodology for biannual minor review, the rates for service bands A, B, C, D and E have been adjusted by NGN2.00 to NGN4.00 per kWhr to reflect the partial impact of inflation and movement in foreign exchange rates,” the statement read in part.
Recall that NERC had raised tariff for the DisCos in September but that drew outrages from customers and the organised labour, promoting the federal government to suspend it while parties dialogued.
By 1st November, 2020, the suspended tariff was implemented after some discounts were given for customers who get 12 hours and above power supply daily. However, those with less than 12 hour supply did not get a tariff hike, according to the NERC order of November 2020.