Financial Energy Review
by Abisola Shola………..
As long as electricity power supply continue to be inadequate in Nigeria consumers will always view with suspicion any plan by the electriic power companies particularly the Distributing companies (DISCOs) to increase tariff.
The DISCOs have once again back down on their move to increase electricity tariff after the National Assembly leadership intervened pointing out that Nigerians and indeed the whole world are just coming out from the ravages of covid-19. Therefore not the right time to increase tariff.
The DisCos reportedly agreed to suspend the increase till the first quarter of next year while the leadership of the National Assembly has promised to meet with President Muhammadu Buhari on the issue.
The DisCos, however, said if the planned hike is eventually deferred till next year, the government should continue to bear the difference in the present tariff and what was considered as the appropriate tariff.
Details of the meeting were made known in a statement by Ola Awoniyi, the media aide to Senate President Ahmad Lawan.
According to the statement, Mr Lawan; Speaker of the House of Representatives, Femi Gbajabiamila and other principal officers of the two chambers met at the National Assembly with the chief executives of the government’s electricity regulatory body and those of the DisCos across the country and succeeded in convincing the DisCos to defer the planned increase.
Also in attendance were the chairmen of the committees on power from the Senate and House of Representatives.
The lawmakers noted that the timing of the planned hike was wrong even though they had not much issue with the need to introduce a cost reflective tariff for the power sector to attract the much needed investment.
To this regard, the DisCos reportedly admitted that they were not well prepared for the planned hike in tariffs even though they so much desired the increase.
“The agreement here is that there is not going to be any increase in the tariffs on July 1st. The Speaker and I, we are going to take appropriate action and meet with the president.
“We are in agreement here that there is no question on the justification of the increase but the time is simply not right and appropriate measures need to be put in place. So between now and the first quarter of next year, our task will be to work together with you to ensure that we put those blocks in place to support the eventual increase in tariffs” Lawan saiid
While he noted that the planned increase in the tariff was of concern to the lawmakers, he said the government has been doing a lot as part of its obligations to provide some form of intervention.
“I’m quite aware that for this year, probably starting from last year, over N600 billion was earmarked for this sector to improve. There is too much stress in the lives of Nigerians today and indeed across the world because of the challenges imposed by COVID-19 pandemic and even before then, we had issues that would always make it tough for our people to effectively pay the tariffs.
“A well intended programme or policy of government can fall flat on the face and never recover if you do it at a wrong time. I think we all agree to that.
“There cannot be a time as bad as this for us to increase anything. Forget about electricity, anything. Whereas, even in time of decreasing revenue, we are even reducing the pump price. I don’t know how we can justify an increase in the cost of electricity at this time in Nigeria.
“Whatever will affect his (Buhari) government is something that should concern all of us. I think this will affect his government. This timing. Not the increase. The timing. I think it will affect his government and if it is going to affect his government, we should all rally around our people, our president and the government to make sure we do the right thing,” he said.
In attendance at the meeting were the representatives of NERC, Kano Electricity Distribution Company, Ikeja Electricity Distribution Company, Kaduna Electricity Distribution Company and Eko Electricity Distribution Company.
