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NERC denies media reports on imminent electricity tariff increase

…As Nigerians kick against plot for hike from second quarter

Contrary to media reports on Sunday that the Nigerian Electricity Regulatory Commission (NERC) is set to increase electricity tariff effective April this year; the Commission has issued a statement dissociating self from the report.

Several media outfits had weekend, misinterpreted the details of the ‘December 2019 Minor Review of Multi-Year Tariff Order 2015 and Minimum Remittance Order for the Year 2020,’ recently released by the agency to mean hike in tariff.

Some reports went as far as saying that the planned increase, which to come into effect from April will be as high as 75 per cent on residential, commercial and industrial customers on both prepaid and estimated billing.

However, in a statement posted on the Commission’s website, General Manager, Public Affairs Department, Dr. Usman Abba Arabi, NERC said “The attention of the NERC has been drawn to the publication in several electronic and print media that end-user electricity tariffs have been increased following the approval of the minor review (2016 – 2018) of the 2015 Multi Year Tariff Order on August 21, 2019.”

“We wish to provide guidance that the minor review implemented by the Commission was a retrospective adjustment of the tariff regime released in 2015 to account for changes in macroeconomic indices for the years 2016, 2017 and 2018 thus providing certainty about revenue shortfall that may have arisen due to the differential between tariffs approved by the regulator and actual end-user tariffs. The principal objectives of the review are clearly articulated in section 6 (a – f) of the Orders which may be downloaded from the Commission’s website.

“The Commission therefore wish to notify the general public that no tariff increase has been approved by the Commission vide the Order. However, the Commission in the discharge of its statutory responsibilities enshrined under the EPSR Act, shall continue to undertake periodic reviews of electricity tariffs in accordance with the prevailing tariff methodology. In all instances of such reviews and rulemaking, the Commission shall widely consult stakeholders and final decision shall take due regard of all contributions,” Dr Arabi concluded.

Already, a vox populi conducted by our correspondents across the country showed that apart from anger and disappointments on the poor quality of power supplies since 2015 to date, the news of planned tariff hike is capable of causing nationwide violent protests.

According to respondents, there is no basis for any tariff increment as instead of a substantial improvement, there had been massive drop in electricity supplies.

A section of respondents also complained of endless challenges faced in getting prepaid meters which they say, suggest that Discos are deliberately delaying access to meters so as to continue bleeding customers on estimated billing platforms.

Analysis of respondents’ views show that over 85 per cent of Discos’ customers are ready to get disconnected if new tariff regime comes without any observable improvements in power supplies to avoid paying for darkness.

But in what suggests an official contradictory stand on the entire issue earlier, the Commission had noted that “The Federal Government’s updated Power Sector Recovery Program does not envisage an immediate increase in end-user tariffs until 1st April 2020 and a transition to full cost reflectivity by end of 2021.

“In the interim, the Federal Government has committed to funding the revenue gap arising from the difference between cost-reflective tariffs determined by the commission and the actual end-user tariffs payable by customers,” NERC stated.

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