A Review of the Nigerian Energy Industry

PENGASSAN faults NERC’s claim on tariffs increase

Dr. Sam Amadi01 October 2013, Lagos – The Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, has called on the federal government to allow the road map for power generation and distribution to fully come on stream before contemplating an additional increase in electricity tariffs.

The Chairman of Nigeria’s Electricity Regulatory Commission, NERC, Dr. Sam Amadi, had argued that the increase in tariffs, in spite of shortfall in service delivery, was in the best interest of Nigerians on the long run as this would encourage more investors to come into the sector and provide life more abundant as being witnessed in the telecommunications industry.

However, the oil workers union pointed out that additional tariff charges will not be in the long term interest of the consumers, citing the cases of telecoms operators who made Nigerians to pay outrageous fees for SIMs that were supposed to be free.

The union’s Public Relations Officer (PRO), Seyi Gambo, in a statement, argued that the generation and distribution companies had paid so dearly that government would be unable to stop the exploitation that would be passed to the consumers.

“PENGASSAN watches in dismay and unbelief as the NERC braces up to implement its decision on pricing regime of electricity even as Nigerians groan under an irregular supply of the commodity, nationwide.

“At first glance, new observers and watchers of policy somersault and abuse in the country may be tempted to fall in line with the reasoning advanced by Dr. Sam Amadi. His argument, however, flies when considered with the objective realities on ground. In a recent meeting with the media, the Minister of Power, Mr. Chinedu Nebo, informed that the federal government has expended about $3.5billion yearly in the last 10 years for the provision of electricity to Nigerians.

“It is also noteworthy that the same federal government, while issuing license to Independent Power Producers (IPP) two years ago charged them to generate enough electricity and supply to the national grid, while also revealing that consumers could pay higher tariffs on two fronts via the fixed cost and energy cost, that is cost per kilowatt hour, private or corporate.

“We are equally of the opinion that corruption has been at the root of government’s inability to generate enough electricity for its people, likewise many other areas of failure in government. We therefore charge the government to be more committed in its fight against this canker worm and to do everything possible to give Nigerians a new lease of life and hope in the survival of this nation and its most disadvantaged population,” the union said.

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