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FG suspends electricity tariff hike



January 16, 2012
Federal Government has suspended the planned tariff hike in the electricity sector proposed to commence this month.
Chairman of the Nigerian Electricity Regulatory Commission (NERC), Dr Sam Amadi told Daily Trust that the plan was halted because they have not done the legal framework for the new tariff to take off.
Under the proposed hike, electricity consumers in the Residential Two (R2) category (residential customers with single-phase meters), where most customers belong, will pay between N10.85 and N14.60 Per Kilowatt hour (kw/h) as against the current rate of N7.30 per Kw/h.
Per kilowatt hour is estimated to be the amount of power consumed by 10 incandescent bulbs in one hour.
In a response to a text message, Dr. Sam said, “although the framework and template have been concluded but the legal side was yet to be done with.”
He said the commission was going to be more strategic before commencing the implementation of the new tariff, saying “we will consider how the increase would affect all other sides of the electricity industry before it is implemented. There is no urgency for it to be implemented this month.”
Transparency International had reacted by saying that increasing electricity tariff at a time power supply was poor would be a time bomb.
Vice President of Transparency International in Nigeria, Ezenwa Nwagwe said the move could snowball into a bigger crisis.
“The Nigerian people have got a strong resentment about poor governance in the country and any attempt to hike the electricity tariff in an atmosphere of poor quality of power supply may be the trigger to a preventable civil uprising,” he said.
Nwagwe had said this at the sideline of an event to mark the public declaration of integrity by the staff of the Nigerian Electricity Regulatory Commission.
He said: “I am saying that the tariff increase may be a time bomb that can snowball the resentment that people feel about lack of governance, about lack of transparency and how injudiciously resources are been used.”
He said there was pent up anger and frustration in the country, in view of increasing bombing incidents around the country plus the high level of unemployment.
Given the high rate of abnormalities in all spheres of Nigeria as a nation, he said the country passes as one of the most peaceful countries in the world, as the people remain patient and resilient in the face of poor leadership.
The increment in electricity tariff, he said, is an issue that should be discussed, with different stakeholders carried along.
He said: “Part of my challenges with the government is what I call arrogance of power. They just think that they know it all and decide that it is time to increase and that there is no cost reflective tariff in place.”
Source: Daily Trust
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