NERC: Nigeria’s Poor Exempted from Proposed Tariff Hike

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* Senate set to review electricity act

By Emmanuel Addeh 

The Nigerian Electricity Regulatory Commission (NERC) has reiterated that the proposed electricity tariff hike, which will take effect from the first quarter of 2021, will not substantially impact poor power consumers in the country.

The Nigerian Electricity Supply Industry (NESI) regulator made the pronouncement, even as the Senate said Monday that it is working with NERC to review the extant laws to meet with current realities.

Speaking during a presentation to the Senate Committee on Power at the commission’s head office in Abuja, the NERC Chairman, Prof. James Momoh, assured the lawmakers that the tariff increase was structured in such a way that the masses will not be affected.

Momoh told the lawmakers, who were on their oversight function, that a strategy had been put in place to ensure that whatever happens, the poor will no longer subsidise the rich.

He said: “It is not going to affect the poor. We will make sure that the downtrodden and the people you feel for at the moment will not be affected by any increase we will be bringing forth.

“It will be based on the hours of service and the quality of power available there. We don’t want the poor to subsidise the payment of the rich. In other words, we must make sure that the poor are not sacrificed in the process of tariff increase.”

In his comments, the Chairman of the committee, Senator Gabriel Suswam, urged the commission to handle the tariff increase with caution because of the economic hardship it could inflict on the people.

He argued that given that many Nigerians cannot afford to feed themselves at the moment, as a result of the impact of the Covid-19 pandemic, the commission had “to make haste slowly”.

Suswam stressed that NERC had reviewed the tariff but that the economy had contracted by over 2 per cent due to the Covid-19 pandemic, noting that by their own programme, NERC was supposed to have activated the increase by 1st of July.

He added: “We met with them at the level of National Assembly and appealed that given the circumstances of the Covid-19, they should tarry awhile and let Nigerians recover a bit from the economic shocks before they can activate that tariff.”

He noted that the commission suspended the hike because of the pleas of the Senate, but insisted that the suspension does not rule out its eventual hike.

The lawmaker explained that the survival of the sector depends on a cost-reflective tariff, adding that the commission was presently supporting the National Assembly to enact the electricity act.

Suswam said that since the one in force at the moment was pre-privatisation of the sector, the new bill would be presented to the National Assembly before August, this year.

“These laws have gone beyond privatisation. There has to be an electricity act that will set the framework that touches on energy theft: how people will be sanctioned.

“It gives potential investors the comfort to come here and invest knowing that legal framework protects them. NERC is supporting us to put that act together. By August, we should be able to put that act before the National Assembly,” he assured.