Bowing to Pressure, FG Directs Reversal of New Electricity Rates

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Minister of Power, Mr. Saleh Mamman

•Suspension of tariffs to persist till end of negotiations with labour
•Power sector hits another transmission peak milestone

Emmanuel Addeh in Abuja

The federal government yesterday directed the immediate rollback of the new tariff increase carried out by the Nigerian Electricity Regulatory Commission (NERC), pending the conclusion of negotiations with the organised labour.

In a statement he personally signed, Minister of Power, Mr. Sale Mamman, noted that the reversion to the old tariff would allow the resolution of all the issues surrounding the hike.
The directive came just as the Transmission Company of Nigeria (TCN), yesterday announced a new milestone in electricity transmission with the sector recording 5,552.80MW on Wednesday.

The minister, however, refuted reports that the tariffs were increased by 50 per cent.
NERC had covertly approved the increase of the tariffs despite the power outages in the country.
In a memo to the Ibadan Electricity Distribution Company (IBEDC), obtained by journalists, NERC had said it hiked the rates considering the changes in inflation rate, foreign exchange, generation capacity, gas prices, among others, since the last review.

However, the increase came less than four months after the last one which was sternly, but unsuccessfully opposed by the organised labour, prompting a temporary suspension, that was finally lifted after negotiations, to pave the way for the implementation of the new pricing regime.
In the revised Multi Year Tariff Order (MYTO) signed by the Chairman of NERC, Mr. Sanusi Garba and Commissioner, Legal, Licensing and Compliance, Dafe Akpeneye, on December 31, 2020, NERC said the new tariff increase took effect from January 1, 2021.

However, the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC) kicked against the new rates and asked the federal government to reverse the tariff increase or face the consequences.
To pacify labour, the federal government had summoned a meeting of the Sub-committee on Review of Tariffs and Charges in the Electricity Sector to review the decision.

Minister of Labour and Employment, Senator Chris Ngige, had told THISDAY on Wednesday that a meeting of the sub-committee had been scheduled to address the concerns and might hold latest this weekend.
But in the statement released yesterday in Abuja, Mamman, who said he had directed NERC to communicate the Distribution Companies (Discos) to revert to the pre-January 1 rates, contradicted himself, saying that the regulatory agency must be allowed to work without undue interference.

“It should be clear to all that the regulator must be allowed to perform its function without undue interference. The role of the government is not to set tariffs, it is to provide policy guidance and an enabling environment for the regulator to protect consumers and for investors to engage directly with consumers,” the minister said.

He stated that till date, the federal government still subsidises electricity tariffs to the tune of 55 per cent for power consumers in band D and E and those on the lifeline band.
“To promote a constructive conclusion of the dialogue with the labour centres (through the Joint Ad-Hoc Committee), I have directed NERC to inform all Discos that they should revert to the tariffs that were applicable in December 2020.

“This will persist until the end of January 2021 (when the FGN/labour committee’s work will be concluded). This will allow for the outcome of all resolutions from the sub-committee to be implemented together,” he added.
He explained that the reported percentage increase has confused the public, adding that government has been engaged in positive discussions about the electricity sector through a joint ad-hoc committee led by the Minister of State for Labour and Productivity, Mr. Festus Keyamo, and co-chaired by the Minister of State for Power, Mr. Goddy Jedy-Agba.

“The public is aware that the federal government and the labour centres have been engaged in positive discussions about the electricity sector through a joint ad-hoc committee led by the minister of state for labour and productivity and co-chaired by the minister of state for power. Great progress has been made in these deliberations, which are set to be concluded at the end of January 2021.

“Some of the achievements of this deliberation with labour are the accelerated rollout of the National Mass Metering Plan (NMMP), clampdowns on estimated billing, improved monitoring of the Service Based Tariff (SBT) and the reduction in tariff rates for bands A to C in October 2020 (that were funded by a creative use of taxes).

“Bi-annual minor reviews to adjust factors such as inflation are part of the process for a sustainable and investable industry and the regulator must be commended for implementing the subsisting regulations while putting in place extensive actions to minimise the adverse impact on end user tariffs,” the minister said.
On the alleged misconceptions concerning the actual rate, Mamman described reports of a 50 per cent hike as false, but did not deny like NERC did that there was an increase.
The minister assured electricity consumers that the Buhari administration is committed to creating a sustainable, growing and rules-based electricity market for the benefit of all Nigerians.

Power Sector Hits Another Transmission Peak Milestone

The Transmission Company of Nigeria (TCN) said yesterday that it had successfully transmitted an enhanced all-time peak of 5,552.80MW recorded by the power sector on Wednesday.
The company noted that the latest all-time peak transmitted surpassed the last peak generation of 5,520.40MW which was also effectively transmitted by TCN on October 30, 2020 by 32.40MW.

A statement by the General Manager, Public Affairs of the organisation, Mrs. Ndidi Mbah, in Abuja, said that the new milestone was wheeled at a frequency of 50.08Hz.
The national peak generation of 5,520.40MW achieved in October, 2020 at 9.15pm, further surpassed the previous 5.459MW recorded on October 28, 2020 by 60.90MW.

“The new national peak is a result of continued collaboration among players and the gradual increase in capacity in the power sector. On her part, with the current capacity of 8,100MW, TCN seamlessly transmitted the new peak at a frequency of 50.11Hz. through the nations grid,” the company stated.
The TCN attributed the new peak to the revamping of power transmission facilities, which have now been activated.