Nigerian Electricity Regulatory Commission suspends electricity tariff increase

The Nigerian Electricity Regulatory Commission (NERC) has halted the proposed increase in electricity tariffs which was initially scheduled for Wednesday (April 1, 2020).

Power transmission lines (REUTERS/Amr Abdallah Dalsh)

The NERC had stated on January 4, 2020 in its December 2019 Minor Review of Multi Year Tariff Order 2015 and Minimum Remittance Order for the Year 2020 for the 11 Discos, indicated that consumers would pay more for electricity from April 1 this year.

The power distribution companies had earlier filed applications with the commission leading to a review of their respective end-user tariffs.

The regulator held the public hearings at various locations within the franchise areas of the Discos from February 25 and March 9 to look into the applications.

It stated that the wide metering gap in the Nigerian electricity supply industry, currently at about 60% “is a major impediment to both an immediate tariff review and revenue protection for Discos.”

The NERC indicated that customers of the 11 Discos are willing to pay appropriate rates for services if only they are guaranteed hours of supply, quality of power and adequate metering.

“There shall be no increase in tariffs of end-use customers on April 1, 2020,” the commission said in a new order.

“The Federal Government of Nigeria shall provide tariff support during the transitional period to full revenue recovery ending on June 30, 2021 based on the under-recovery of the revenue requirement determined by the commission,” NERC added.

NERC has subsequently ordered all the Discos to submit a detailed plan for the full recovery of prudent costs and allowed return on capital by June 30, 2021.

It added that the revenue recovery and financial sustainability plans should be submitted latest by April 21 2020.

“All future tariff reviews shall be on the basis of consultations between the Disco and customer clusters with firm commitments on rates and quality of service.”

Meanwhile, the Nigeria Labour Congress (NLC) has said that NERC would be insensitive if it had announced the planned tariff hike.

The President NLC, Ayuba Wanna, explained that at a recent interactive session with NERC in Kano State all the leaders of the NLC’s affiliate unions were against the planned increase in electricity tariff.

He said the NLC “completely condemns and totally rejects any plan to inflict further pain on Nigerians at this very trying period of the novel coronavirus pandemic through increase in electricity tariff.”

“We wish to state that any increase in electricity tariff would only convey a deafening expression of insensitivity to the plight of the Nigerian people who are currently dealing with the social scare, income haemorrhage, economic squeeze and mortal dread of COVID-19,” he added.

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