While Nigerians continue to groan under the stress and strain of the harsh economic reality occasioned by the devastating impact of COVID-19 and worsening inflation amid high unemployment rate, it appears the stakeholders in the power sector are bent on compounding the citizens’ woes.
Recently, notification from the Eko Electricity Distribution Company purportedly signed by the General Manager, Loss Reduction to its customers has ignited a widespread speculation that the distribution companies got approval to increase electricity tariff.
The notice titled ‘Re: Tariff increase notification’, officially notified customers of an increase in electricity tariff with effect from September 1, 2021. “This increase is as a result of the nationwide mandate to implement the Service Based Tariff approved by our regulators”, the Eko Electricity Distribution Company said in a statement which has since been disclaimed.
Based on the newly approved plan, customers with lower power consumption capacity have their rates increased by N2 per kilowatt hour from N54.08/kwh to N56.08/kwh and are promised at least 20 hours of daily power supply.
Even though Eko DisCo denied the notice, assuring that customers would be informed of any change in tariff, Nigerians have continued to condemn the planned hike describing it as deliberate attempt to further pauperize the already impoverished citizens.
For quite some time now, the distribution companies, and indeed other key players in the sector, have been making the case for cost reflective tariff insisting that what Nigerians currently pay for power does not truly reflect the cost of generation and distribution.
In September 2020, the federal government-organised labour committee on electricity tariff agreed to freeze further increases in electricity tariff until the committee concludes its work and its report adopted by all the principals in the committee.
There is nothing in the public domain to show that the committee has concluded its assignment and agreed on a given tariff increase. That being the case, we still cannot fathom the basis for the latest talk about a hike in tariff.
Nevertheless, why are the distribution companies in a haste to increase the tariff? Is it fair to raise tariff for power that is endlessly epileptic with consumers bearing virtually all the cost including purchasing and, in most cases, maintaining transformers?
While not oblivious of the need to have a cost-reflective tariff, we strongly believe that such can justifiably be done only when there is a guaranteed steady power supply with virtually all the consumers metered.
Even though the DisCos are wont to say that Nigeria has a relatively low tariff when compared with what obtains in other countries in the continent or within the region, Nigerians are very suspicious of the DisCos especially since most electricity consumers in the country are charged based on estimated billing. The talk about mass rollout of prepaid metres has remained a hype.
Like most Nigerians, we believe the move to increase tariff is ill- timed and should be suspended because it is coming at a time most Nigerians are struggling to cope with the impact of harsh dislocations occasioned by both the Covid-19 pandemic and the economic crisis.
It is our considered opinion that there is no justification, whatsoever, for a new hike in electricity tariff given the fact that the previous hikes have not translated into significant improvement in the electricity supply. We note rather sadly, that in spite of the previous hikes, electricity supply remains epileptic with most Nigerians forced by DisCos to pay heavily for darkness.
Rather than contemplate a hike in tariff, the DisCos should, in partnership with all the stakeholders in the nation’s energy mix, work out modalities to ensure the availability of regular power supply. Once Nigerians are guaranteed regular, as opposed to the current epileptic power supply, there will be little or no resentment to raise the tariff.
While the hike may be fitting in the near future, now is certainly not the appropriate time to consider it. Our candid advice to the Nigerian Electricity Regulatory Commission-NERC- is for it to halt it.
By and large, in the midst of the debate over the propriety or otherwise of a tariff hike, the fact that the nation needs cheap, clean, affordable and efficient electricity to spark industrialization and create jobs for the mass of under-employed and unemployed persons roaming the streets, some of who have resort to all forms of criminality, cannot be underestimated.