NERC Gives Conditions for Electricity Tariff Increase

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James Momoh
Chairman of NERC, Prof. James Momoh

Emmanuel Addeh in Abuja

The Nigerian Electricity Regulatory Agency (NERC) said yesterday that there will be no arbitrary increase in the tariffs paid by Nigerians for electricity until certain conditions are met by Distribution Companies (Discos).

Chairman of the regulatory agency for the power sector, Prof. James Momoh, stated that the principles laid down by NERC would be strictly followed before any review would be effected.

Momoh spoke against the backdrop of reports that the NERC was set to begin implementation of a new tariff regime by September 1, after it was approved by President Muhammadu Buhari, being a precondition for the release of a $750 million loan for the sector by the World Bank.

The regulator noted that due process will be strictly followed, including consultations with customers, increase in hours of supply per day, substantial metering of consumers and an overall improvement in quality of service.

Momoh said: “In response to media reports that there is an increase in tariffs for Nigerians, NERC wishes to clarify that tariff reviews going forward will only follow service-based principles.

“Under these service-based principles Discos will only be able to review tariff rates for customers when they consult with customers, commit to increasing the number of hours of supply per day and quality of service.

“In all cases, poor and vulnerable Nigerians will not experience any increase. In line with these expectations, Discos are directed to engage with their customers on a Service-Based Tariff structure”.

NERC stressed that under the service based tariff structure, Discos can only review tariffs for customers under certain conditions, including that: “customers are consulted and communicated a guaranteed level of electricity service by the Discos based on hours of supply, customers are metered and no estimated billing through the strict enforcement of the capping regulation”

It added: “This means that unmetered customers will not experience any cost increase beyond what is chargeable to metered customers in the same area.

“Even under the above conditions, there will be no change in tariffs for the most vulnerable as tariffs for those consuming 50KW or less remain frozen. Customers receiving less than 12 hours of supply will also not experience any change in tariffs.”

It said that apart from that, the president had directed that there should be a nationwide mass-metering program in an effort by the federal government to put a stop to estimated and arbitrary billing for electricity.

“He (president) has also approved a waiver of the import levy on meters, so that those that do not have meters can be supplied as early as possible at reasonable costs.

“The general public and all stakeholders in the power sector are by this the statement urged to disregard any reports of an arbitrary tariff increase affecting Nigerians” NERC said.