25 May 2015, Lagos – The Manufacturers Association of Nigeria (MAN), yesterday, urged the incoming government to streamline electricity tariff to reflect the actual consumption by the industries instead of the current use of estimated bills.
The president of MAN, Dr. Frank Jacobs, made this call at the media luncheon held at MAN’s house, adding that, if the electricity tariff is streamlined, it will drive further improvement in power supply and create a special electricity tariff lines for heavy users of electricity like steel, cement and other strategic sub-sector.
“Make it mandatory for DISCOs to procure prepaid meters from local manufacturers and distribute same to all customers to properly regularize electricity billing. Facilitate adequate local sourcing of LPFO, especially for supply at reasonable price to industries operating in areas without gas network” he said.
According to him, electricity generation in the first quarter of 2015 showed slight improvement as generation hovered around 4,000 MW per day, however, transmission and distribution of available electricity output were abysmal in the period due to long time of decayed infrastructure in the system. These scenarios contrast with the huge energy need of the Industrial sector including manufacturing.
The promise of adequate and stable electricity for industrial production as embedded in the objectives of the power sector reform remains regrettably elusive. “Ironically, in spite of the poor energy situation in the country, the Nigerian Electricity Regulatory Committee (NERC) has maintained increased in electricity charges not considering its implication on the economy especially the productive sector.
The most detrimental is the so called fixed electricity charges which stood astronomically across distribution zone with Kaduna at N580,600; Jos (370,760); Yola (358,331) and Abuja (243,168) per month in MYTO 2.0 for D3 category” he stated. Jacob said manufacturers faced with payment for electricity not consumed.
Inspite of the current high tariff from NERC, industry expends huge funds on alternative energy sources for production and the implication of the development was increase in the average cost of production in the sector, which lowers the competitiveness of locally produced goods against imported close substitutes. He urged the incoming government to revisit the power sector reform so as to ease-out the current stagnation and make the sector functional.