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Electricity hike: power experts urge FG to review 300% tariff increase  

Electricity hike: power experts urge FG to review 300% tariff increase


By Yusuf Yunus

Some power experts have urged the Federal Government to review the Multi-Year Tariff Order (MYTO) of 300 per cent increase in electricity tariff by the Nigerian Electricity Regulatory Commission (NERC).

In seperate interviews with the Business Intelligence ( TBI Africa) in Lagos, they argued that the policy was not consumers’ friendly

It would be recalled that on April 3, Mr Musiliu Oseni, the Vice Chairman, NERC, Musiliu Oseni announced the increase of 300 per cent electricity tariff for Band A consumers in the country

Oseni said the increase will only affect 15 per cent of the electricity customers in the country.

Accordingly, power distribution companies (DisCos) will be allowed to raise electricity prices to N225 ($0.15) per kilowatt-hour from N68 for urban consumers this month effectively from April 1, 2024.

Mr Chinedu Bosah, theNational Coordinator, Coalition for Affordable and Regular Electricity (CARE), tasked the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) to lead a resistance to this outrageous and inhuman tariff hike.

Bosah urged Nigerian working masses to rise to resist the outrageous tariff hike as well as the Naira devaluation and the increase in prices of petroleum products as a result of subsidy removal.

He said that the increase of gas prices by government to power companies from $2.18mmbtu to $2.42mmbtu was just the continuation of the neo-liberal anti-people policies.

According to him,  It is anti-people because it will eventually increase the cost of power generation and the cost of electricity to consumers.

“Nigeria is a major oil and gas country and yet its people cannot enjoy any benefit, not even a significant global comparative advantage.

“As if the suffering inflicted on Nigerians is not enough, particularly on the poor working masses through the implementation of fuel subsidy removal and devaluation of the Naira,” he said

Bosah said that President Bola Tinubu-led government is increasing the price of gas and also began an outrageous electricity tariff hike for customers on Band A  from N66 to N225, which is about 241 per cent.

” This one hike is almost the cumulative seven hikes put together since the privatisation of the power sector in November 2013.

“For instance, Band A customers who previously spent an average of N30,000 per month will henceforth spend about N67,320 monthly.

“This can only come from an insensitive and callous government,” he explained.

Bosah said: “There is no good time to implement these terrible anti-people policies that only make a few richer while the vast majority of Nigerians are thrown into more poverty.

” Nigeria cannot be developed through sustained imposition of mass suffering on Nigerian working people through attacks on living standards.

“Nigeria can only be developed through massive investment in basic infrastructure and industries but under transparent and democratic control/management of workers and community people.

“Since September 2023, the electricity supply to these Band A customers has collapsed to less than nine hours daily and on some days, these customers are plunged into total darkness for some days due to regular system collapse.

The expert said that private power companies and the government have shown obvious incapacity to improve electricity generation, transmission and  distribution.

“This hike on Band A customers is just a testing ground for another hikes on customers on the other Bands.

” Hence, similar to previous attacks on the living standards of most Nigerians.

“The electricity tariff hike will further increase the cost of production/services and cost of goods; this will accelerate the rising cost of living, poverty, deprivation and unemployment,” he added.

Similarly,  Dr Akinrolabu Olukayode, the Chairman of the Customer Consultative Forum of Festac/Satellite Town said: “The 300 per cent increase was a stab which will leave a blistering wound on the living standards of the customers as they are not economically ready for such outrageous increase.

“The 300 per cent increase can also be a sacrifice to be made for improved supply.

” Federal Government must be proactive to ensure investment in the power sector is utilised to build up infrastructures for better performance,” he said.

Olukayode said that the customer who will have to bear the brunt of astronomical rise in price of fuel, to generate power due to incessant collapse of the grid.

He said customers will also bear the brunt of the rise in the price of other foods and services without an attendant increase in their take home monthly pay

On increase in gas price, Olukayode said there is obvious lacuna in the application of knowledge in micro and macro economics of the present day economic imbroglio.

He said that all over the globe the continent Africa is reduced to mere puppet in the midst of her vast economic resources informing imperialistic hullabaloo and cataclysmic economic brouhaha

“In the 90’s recall the massive gas flarring in the Niger Delta. It was in excessive abundance yet we couldn’t dollarise it for our own economic emancipation because of the dominance by the first world nation who are surreptitiously benefitting from the calculated wastage.

“Today, the petroleum products and resources which are all in excess are now what we are currently lacking while the affiliated first world nations are maximally utilising the cyphooned quantum to their advantage.

“It is a melancholy sad tale from the stead of mediocrity to attempt to raise the price of gas to the Gencos at this awkwardly auspicious time.

” The masses are dangerously at the receiving end,” he said.

The expert said: “lt is a known fact that, our electricity is a combination of Hydro, solar, gas and fossil.

“The government did not develop any policy to customise a favorable percentage from the extraction (primary) stage for ustilisation purpose of serving the national grid.

” This is profligacy anchored on ignorance.

“The consequences of increased gas price is obviously composite.

” The electricity tariff will certainly be jerked up.

” That will spell yet another doom’s day tale for the poor and innocent unsuspecting masses or consumers – who had to take the excruciating pain of estimated billing and acute power outages due to consistent collapse of the national grid,” he added.

Olukayode said that the peged cost of commercial gas at $2. 92mmbtu was prematured and untimely and antithetical to the expected relief effect on the masses.

“I will recommend a radical decision to sell out gas in Naira to the foreign market in order to give out gas a boost and raise revenue for Nigeria instead of raising the cost to the detriment of the poor masses.

“This country requires thorough restructuring where regions/states can independently anchor their resources without government’s unnecessary incursion.

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