By Favour Nnabugwu
Bureau of Public Enterprises, BPE, has said that a new power subsidy is in the offing and will take effect January 1, 2012 to cushion the effect of high rate of power for consumers.
Mrs Bolanle Onaguruwa, BPE Director-General, said this at the Security and Exchange Commission, SEC, session on the privatisation of Power Holding Company of Nigeria Plc, PHCN.
She said: “We are introducing a new subsidy on power which will commence in January 2012.
“People actually misunderstand the Multi-Year Tariff Order, MYTO, subsidy on power. The MYTO subsidy is a tariff order. The subsidy is supposed to cushion the shock in the period that we are trying to get the production power up.
“Under MYTO, electricity tariffs are to be determined by market dynamics. But to protect low-income earners from having to pay exorbitant bills.
“The subsidy that we are proposing right now is supposed to do the same thing as the so-called MYTO subsidy was supposed to do. That is, to lessen the effect of high tariff.
“Several ideas are coming up as to how the new subsidy is going to be funded. But I am not ready to make it public yet. I must say that we have brilliant ideas on how to fund the subsidy.”