February 23, 2012
Chairman of the Nigerian Electricity Regulatory Commission (NERC), Dr. Sam Amadi, Wednesday said contrary to reports that electricity tariff would rise by 88 per cent, consumers would pay as low as 11 per cent increment when the new tariff regime takes effect in May this year.
Speaking during an interactive session with journalists in Abuja, Amadi said the new tariff would come in categories for various consumers and that would have been responsible for the wrong figure of 88 per cent reported by some media recently.
“It is not true that the tariff will increase by 88 per cent. The increase is about 11 per cent,” he said, adding that even certain category of consumers classified as “special customers” such as hospitals and street lights would even pay lower than the 11 per cent increase.
Explaining a possible cause of different tariff being announced by different persons, the NERC boss said: “If you combine commercial rates and residential rates then they give you wrong figures.”
The Minister of Power, Prof. Bath Nnaji, was reported to have told the Senate Committee on Power that the increase would be from the current N2:20k to N3:20k
However, both Nnaji and Amadi agree that R1 consumers consisting of rural dwellers and urban poor would pay lower tariff as they would continue to enjoy subsidy from the Federal Government as first category of commercial consumers.
He said another group, C1, consisting of artisans and small businesses, would also pay lower tariff in line with Federal Government’s policy of providing power to small and medium enterprises in the country.
“In working out the tariff, we place the burden differently. We are to cross-subsidise those who cannot pay. As such, the cost of power for the R1 and C1 categories will still enjoy part of the cross-subsidy,” he said.
Other measures put in place by the NERC to eliminate unnecessary charges included removal of fixed charges, a 50-per-cent cut in meter maintenance charge, which consumers had suffered at the hands of the Power Holding Company of Nigeria (PHCN).
Meter maintenance charge, he went on, had been reduced from N1, 000 to N500, adding that NERC would put in place a transparent billing system to avoid a situation where consumers are not over-charged by power distribution companies.
In the absence of prepaid meters, Amadi disclosed that estimation method would continue to be used, but also added that figures arrived at through estimation should no longer be different from what the meters read for customers of similar consumption capacity.