FAQs On Service-Based Tariff - NERC

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Thursday, August 27, 2020 /10:48 AM / by  NERC Nigeria / Header Image Credit: Twiter; @NERCNG

 

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What does NERC mean and what do they do?

NERC means Nigerian Electricity Regulatory Commission. It is the value chain regulator for the Nigerian Electricity Supply Industry

 

The Commission is responsible to license electricity distribution companies, transmission services, electricity generation companies.

 

The Commission has the responsibility to ensure consumption and production of electricity is done in a manner that is safe and that tariff is fair to electricity customers.

 

Who is a DISCO and Where is my DISCO?

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Is this the right time to review tariffs?

'There will never be a good time to review the tariff, The interest here is to ensure that Nigerians are migrated to threshold where there will be continuous improvement in the quality of service delivery.

 

Is the tariff review going to affect me?

'The proposed service-based tariff (SBT) review which comes into effect on Ist September 2020 will only affect customers that live in areas where their DISCOs promise to provide them electricity for at least 12 hours perday

 

Who pays more and who pays less?

The SBT will operate a progress regime - the customers that receive the highest quality of service (12-24 hours per day) will pay the highest tariff. Customers that receive under 12 hours of service per day will continue paying their current tariffs.i.e no increase on September 1st.

 

Why is the government being insensitive?

The SBT is designed to protect the poor. Only the wealthy customers in areas that receive over 12 hours service will experience a tarff increase. SBT will allow the Government to stop electricity subsidy on the rich which can allow the Government to divert its scarce resources to more pressing sectors including education and healthcare.

 

How many people will this tariff affect and locations?

'The tariff review is expected to only affect less than the richest 25% of the poputation living in the most prosperous areas of the country. The richest 10% of the population will cover as much as 50% of tariff increase. The details of the location that will be provided by each DISCO.

 

Is the government providing any palliatives to consumers?

The Federal Government is mind full of the responsibility to ensure improved quality of service delivery. The 'Siemens contract will ensure improvement in the power sector.

 

Will I continue to be on estimated silling?

The Federal Government through the Ministry of Finance, Budiget and National Plarnvang as well as the Central Bank of Nigeria and the Wostd Bank are working towards an extensive mass metering program which aims to close the metering gap by providing as many as 6 million meters, in the interim, NERC has issued a capping requiation which prevents DISCOs from charging unmetaned customers excessively. The capping reguiation mandates that unmetered customers can only be charged as much as comparable metered customerns within their area.

 

Will I continue to pay for the same quality of service for a higher tariff?

The Service reflective tariff is built around incremental improvements in the quality and quantity of supply. Depending on their historical supply pattern, Customers will observe increased hours of supply as the Discos (migrate them to higher "service bands". Ultimately, customers will pay for service commensurate to the number of hours of supply they receive.

 

Will I continue to contribute to buy transformers, wires, and poles?

With the improved tariff, exceptional incidences of customers paying or contributing to purchase transformers, wires, and poles - which were covered under the Investment in Electricity Networks Regulation of the Commission - will reduce even further. Distribution Companies will embrace their responsibilities in full. Distribution Companies will respond swiftly to complaints on damaged equipment and restore supply in line with the Customer Service Standards for performance.

 

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