Discos Join Gencos to Call for Electricity Tariff Hike

  • Allege underhand practices in Gencos’ monthly supply invoices

Chineme Okafor in Abuja

The 11 electricity distribution companies (Discos) in Nigeria’s power industry yesterday said they were in support of the recent request on the Nigerian Electricity Regulatory Commission (NERC) to power generation companies (Gencos) to review the electricity market tariff, saying that the renewed call has justified their prior request for such review.

The Discos also alleged that the monthly electricity supplies invoices issued them by the Gencos may have been manipulated by the Gencos with the contrasting charges on capacity payments and actual energy supplies levied against them by the Gencos.

The Director Research and Advocacy of the Discos trade union – Association of Nigerian Electricity Distributors (ANED), Mr. Sunday Oduntan, stated these during a press briefing in Abuja.

Oduntan, said the Gencos’ call for a tariff review to appropriately price electricity service in Nigeria has vindicated the Discos who had earlier called for such review but were allegedly labelled as unpatriotic and dishonest corporate citizens.

According to him, there was no way the Discos would continue to buy electricity from the Gencos at an average of N68 per kilowatt hour (kwh), and retail to consumers at N31.50/kwh, adding that the existing tariff has to be reviewed.

Recently at the quarterly presidential business meeting held in Abuja, the Gencos said the government would have to increase electricity tariff in the country because of the high cost of operating in the sector.

The Vice Chairman of Mainstream Energy Solution, Ismaila Funtua, told journalists on the sidelines of the meeting that Gencos were asking the government to stop subsidising electricity and let those who can pay for it do so.

Funtua also stated that the Gencos had requested the Acting President, Yemi Osinbajo and relevant government agencies to sort out the constraints they experience in their businesses.

He said: “Whether government likes it or not, they have to review the tariff of power in this country. All those playing politics with it that they do not want to increase, people do not want to hear of this. This is my cell phone; you pay for it even before you make use of it. And nobody is controlling the tariff, they charge what they want and all of us have at least one cell phone, therefore government needs to do the needful.

“If government wants power, then they cannot continue to subsidise for people, you were there when the minister of power was saying that people who have ability to pay will pay but those government needs to subsidise will be subsidised for.”

Speaking however at the press briefing, Oduntan, stated: “ANED is not calling for an increase in tariff but only lending its voice to the call by all stakeholders, and we are saying that as Discos, we have been vindicated.

“We said it over and over that a situation where you buy your product for N68 and because of the tariff that was fixed in 2015 and which allows you to sell by N31.50 kobo is not sustainable unless we can look at it and something is done.

“A lot of things can be done there: subsidy to fill that shortfall and now that others have been saying it, it is a vindication and has confirmed our calls all the while. We need to look at the power problem in a holistic view. We believe those calls by other stakeholders are good and patriotic calls,” Oduntan added.

Speaking on allegations that Gencos are inflating their monthly invoices to the Discos, he said: “Capacity charge is higher than energy charge in the invoice, it is time for the government to look at it. Between the Gencos and NBET, we need to see transparency.

“They should open their books and let us see what is there. Enough of any fraud, they should open their books and let us see. You cannot say that I am owing you money and I don’t know how that money came about. Doctoring invoices is not acceptable and government should look at it.”