February 25, 2020

Consider plights of electricity customers in tarrif review — FCCPC urges NERC


The Federal Competition and Consumer Protection Commission (FCCPC) has urged the Nigerian Electricity Regulatory Commission (NERC) to consider plights of electricity consumers in the proposed review of electricity tariff.

Also read: EKEDC CEO conferred fellow Nigerian Institution of Mechanical Engineer

Its Director-General, Mr Babatunde Irukera, made the plea at a public hearing on an application by Eko Distribution Plc to NERC for “Extra-Ordinary Tariff Review Pursuant” to the commission on Tuesday in Lagos.

The News Agency of Nigeria (NAN) reports that the Eko Distribution at the hearing requested a proposal for upward review in electricity tariff.

Irukera said that the proposal for increment in tariff would not be appreciated by electricity customers due to epileptic power supply being experienced in the country.

He also said that there was a need to ensure regular electricity supply to justify the value for money paid by customers if they were to embrace the tariff review.

According to him, the real thing is not what consumers are willing to pay, but they need to understand that an equilibrium level should be achieved.

Irukera explained that the equilibrium level exists only when the effective power supply exists, and that makes customers willing to pay for the services they enjoyed.

The director-general noted that the Disco would have to address the issues of metering and estimated billing which was major concerns by customers instead of only addressing its low revenue generation.

He cautioned the Disco against the belief that constant power supply would only be available when the tariff was increased.

“We all agree that efficiency will continue to be a problem and so, the position we have taken so far is that what industries seek to do is to transfer the government subsidy to consumer subsidies.

“There are three main reasons that the Discos, particularly Eko had repeatedly articulated as some of the problems in the industry.

“One is that they are unable to remit the full revenue they are collecting on behalf of everybody in the industry, they are unable to remit it to NBET.

“One, low tariff; two, energy theft, and three, metering. And it seems to me that the broad presentation that we have heard today addresses only one, which is a low tariff.

“If you are going to promote efficiency, the only way to promote it certainly cannot be by increasing tariffs,” Irukera said.

According to him, there is absolutely no question about the fact that increasing tariff will not in itself necessarily promote efficiency.

The director-general also said that there was no moral justification for Disco to embark on estimated billing.

He, therefore, called on the regulator to institute a framework to see that electricity consumers were protected in the whole process.

Also, some electricity consumers, who were present at the hearing, rejected the proposed tariff increase, saying that efficient service delivery and improved power supply should be met first.

Earlier, Eko Disco, through its Head of Power Procurement Regulation, Mr Nosa Igbinedion, requested at the presentation for an increase in electricity tariff from the current N28.28kwh to N42.41kwh.

Meanwhile, Mr Shitta Rogers, Chairman of the hearing panel and Commissioner at NERC,  said the team would look into all issues raised by Eko Disco and the consumers’ concerns for effective service delivery.