Electricity Featured

Discos Race To Implement New Tariff

All power distribution companies have put their customers on notice per the impending increase in tariff stating reasons for the development

For instance, the Ibadan Electricity Distribution Company (IBEDC) Plc will be implementing a tariff review beginning from July1, 2020 as part of efforts to deliver excellent services to its customers.

Engr. John Ayodele, the Chief Operating Officer,who revealed this on Thursday ,explained that the  objective of the review is to ensure that IBEDC adjusts its tariff in line with the current economic realities.

This is required to meet the new Performance Improvement Plans (PIP) for Electricity Distribution Companies in Nigeria, as well as to achieve financial and fiscal sustainability in the Nigerian power sector.

He said: “In order to provide more efficient and reliable service to customers, cost-reflective tariffs are required to cover the cost of critical investment in infrastructures and other parameters necessary for improved service delivery. This new tariff design is based on quantity of power supplied as customers will only pay based on availability of supply.” For example, the tariff design is based on the service delivery, such that those receiving 20hrs supply daily will pay more than those getting 10hrs. Engr.Ayodele also explained that, the company is very mindful of the challenging economic situation occasioned by the global pandemic COVID-19, but the micro economic facts of rising inflation rates and a volatile foreign exchange market compelled the implementation of the new tariff design.

According to him, “The tariff review is to reflect macroeconomic indices in Nigeria and the global harsh economic realities facing the power sector”.

Besides, the management of Kaduna Electric explained  said the new tariff which will be cost reflective will ensure customers enjoy better quality of power supply and increased hours of supply as well. It said customers who enjoy more hours of supply will be expected to pay a little more for it.

The company in a statement issued by the Head of Corporate Communication,  Abdulazeez Abdullah, said a comprehensive Performance Improvement Plan had been forwarded to the Nigerian Electricity Regulatory Commission detailing steps to be taken to ensure customers enjoy much improved services by the time the new tariff regime kicks off.

The statement said the company is discarding its old customer categorization – Residential, Commercial,  Industrial – to a new more flexible tariff band categorisation which will see customers graded under A to E tariff band.

The statement further noted that the new tariff regime has become necessary in order to curb the persistent liquidity crisis that is threatening to cripple the nation’s power sector.

The new pricing therefore will ensure a win-win situation for all stakeholders as customers will enjoy better service delivery while the power value chain comprising the generation, transmission distribution and gas supply companies will get adequate payment for services rendered.

Nigerians Kick 

Nigerians yesterday expressed disgusts over the new electricity tariff which is expected to kick off next month across the country.

They said there was no justification for the tariff to skyrocket now when they have not derived the benefits of the privatization of the power sector since 2013.

Besides, some of the stakeholders who spoke with Daily Independent said it amounts to insensitivity on the part of the government to accede to the hike in tariff in the midst of the excruciating pains Nigerians are still going through as a result of the COVID-19 pandemic with attendant consequence on their disposable income.

They are further disenchanted that the federal government, Senate and power distribution couldn’t seal workable deal over the planned  two months free electricity only to now  contemplate high in electricity tariff.

Comrade Chinedu Bosah, the Coordinator, Coalition for Affordable and Regular Electricity (CARE), told SUNDAY INDEPENDENT that the increase in electricity tariff was a rip off on Nigerians income who desire better treatment from service providers in the sector but are regrettably rewarded with poor service.

He wondered why the Federal Government allows  the electricity tariff hike to sail through in the midst of poor performance of the power investors and the economic misfortunes of most Nigerians.

He appealed to the government to consider reversing the privatisation of the power sector on the ground that it does not reflect the wishes of Nigerians and the assets of the defunct Power Holding Company of Nigeria are  in the hands of wrong investors whose only aim is profiteering.

He also implored Nigerians to vehemently reject the hike.

Adetokunbo Mumuni, the Executive Director, SERAP, said:  “Until Nigerians start seeing electricity directly and repeatedly there is no basis to say there will be an increment in the tariff of electricity, to be talking about an increase of electricity tariff without Nigerians properly served electricity and will not be in the interest of the Nigerian people.

“What they are doing now is putting the cart before the horse because services have to come and they are stable before you can be talking about the increase in charges and not poor service.

“Nigerians should demand improved services and not accept tariff hike with poor services.

“There should be a forensic investigation of all that has happened in terms of provision of electricity for Nigerians so that those who have culpability should be brought to justice. Let the investigation start in 1999.

“A thorough investigation of all that happened must be done so that whoever is found culpable would be brought to justice.

“On carrying out a forensic audit it should be in line with Buhari’s duty to do it because he is the one that said he is interested in fighting corruption since he said he has integrity and what he has we ask him to supply to Nigerians.

“I think Nigerians should find a way of taking steps to oppose this proposed increment because it doesn’t make any sense at all and absolutely.

Ene Obi, the Country Director, ActionAid Nigeria, in her reaction said: “At a point when even the Federal Government lowered the pump price of fuel because of what is going on in the market, why would the Electricity Companies want Nigerians to pay more?

“I call on the Electricity Regulatory Commission to quickly call them to order. What reasons are they given to ask Nigerians to pay more? With metered points, Nigerians are happy to pay for services rendered. Electricity is a life wire of industrialisation, we are not happy that the Federal Government privatised it, if they are not satisfied, the government should take back the system and re-energize it to create employment and expand the process.

“Very unique is the introduction of solar power, this will shock power companies when Nigerians really know how to use them because we have sunlight all year round.

“COVID-19 is enough struggles that people are trying to find their feet. Citizens have enough burdens right now.

“I call on Nigerians to reject any increase and demand for efficiency in the power supply. We must remain united against further exploitation by the system.”

The Executive Director of the Africa Network for Environment and Economic Justice, ANEEJ, Rev David Ugolor, on his part, said, “It is inappropriate for the Federal Government to nurse the idea of increasing the electricity tariff at this point in time when COVID-19 pandemic has increased the poverty across the Country. Millions of Nigerians are going through difficult times and it will be insensitive for any Government to ignore the plight of the people and beginning to consider increasing a service that is not even available.

“Around the world government is implementing palliative to address the negative effects of the COVID-19 pandemic and Nigeria should not be an exception.  Access to electricity will help the poor to reduce the Covid-19 challenge and also aid the economy.

“The Federal Government should look for creative ways to stimulate the economy rather than following the old International Monetary Fund, IMF, a prescription that will increase economic hardship.  The neoliberal framework will not solve the Nigeria economy problem.  We need to be pragmatic and look inward to address the Post-COVID-19 agenda.

“The federal and state governments should explore the options of reducing the cost of governance. The savings from such actions will be used to invest in strengthening the economy and jobs will be available for the people. When the economy functions very well people will be able to pay their bills.

“My humble advice to the President is that he should not allow the IMF Policy guide the way out of the present crisis and we should look for innovative solutions using recovered ‘Stolen assets to Finance Social Investment Programme’ that will benefit the poor”.

Director, Health for Mother Earth Foundation, HOMEF, Rev Nnimmo Bassey, said, “Nigerians are ready to pay for electricity. Yes. But when it comes to paying for the darkness it is a big No! The notion that Nigerians should be paying more for the power they don’t enjoy is very provocative.

“In a situation where most citizens are complaining of poor service delivery and are angry at being made to pay wild estimated bills, this move cannot be justified.

“If the idea is for revenue generation there are a few basic things government can do. Ensure that power distributors provide consumers with prepaid meters. Partner with renewable energy companies and agencies in making distributed supply available.

“Encourage and invest in community-controlled low canon and nonpolluting power supply systems. Convert the gas that is being flared in the oil fields into electricity in the short term and shift rapidly to renewable modes.

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