A Review of the Nigerian Energy Industry

Senate seeks abolition of fixed electricity charges

12 August 2015, Abuja – The Senate on Tuesday directed the National Electricity Regulatory Commission to abolish the monthly fixed charges being collected from electricity consumers by the distribution companies.

Senate chamber of the Nigerian national assembly.
Senate chamber of the Nigerian national assembly.

The resolution followed a motion titled, “Unfair trade practices of electricity distribution companies in Nigeria”, sponsored by Senator Sam Egwu and Senator David Umaru of Niger East Senatorial District.

The senators accused the Discos of conspiracy to rip off innocent customers despite epileptic supply of electricity to their homes and business premises.

They urged NERC to inquire into numerous complaints before it in line with the provisions of Section 74 (1) (b) of the Power Reform Act.

The senators also directed the Discos to discontinue the practice of making consumers to pay for meters, poles and transformers.

They, however, said that where the consumers had purchased those items, they should give notice of the purchase to the Discos to enable them to recover the expenses from subsequent consumption of electricity.

Apart from this, they directed NERC to be reporting its activities periodically to the Senate.

Egwu had noted that NERC was established to, among others, license and regulate persons engaged in the generation, transmission, system operation distribution and trading of electricity.

According to him, the same NERC was also empowered by Section 32(1) (d) of its enabling legal regime to ensure that the prices charged those licensed are fair to customers and are sufficient to allow the firms to finance their activities.

The lawmaker, however, noted that the Discos since the beginning of their operations in Nigeria had been ripping off consumers through fixed charges and bulk metering across the country.

He said, “The high tariff being charged by the Discos does not make provision for payment of only electricity that is consumed even though bills are dished out without commensurate services being offered by the distribution companies.”

He also said, “This billing system is capable of ruining the economic power of most small scale businesses that require electricity to function.

“I am concerned that even those that have this prepaid meters are being billed a fixed rate of about N750 a month, irrespective of whether or not the person consumes electricity.”

Egwu therefore urged the Senate to mandate NERC to inquire into numerous complaints before it by consumers.

All the senators who contributed to the debate condemned the activities of the electricity distribution companies.

For instance, Senator Ben Murray-Bruce, (Peoples Democratic Party, Bayelsa East), described the Discos as a big scam.

The senator lamented that his firms were being charged an average of N20m monthly on electricity despite the poor supply, thus forcing the management to use generators most of the time.

He said, “Despite the high tariff, consumers receive little or no electricity. This is a fraudulent act. The Federal Government and the companies are extorting Nigerians and they are all guilty.”

Senator Danjuma Goje, (All Progressives Congress, Gombe Central), and a PDP member from Akwa Ibom South, Senator Nelson Effiong, advocated the review of the Power Reform Act in order to address inadequacies discovered in the Act.

The Senate President, Bukola Saraki, lamented that Nigerians were not feeling the impact of the electricity firms despite the huge sums they were charging their customers.

He urged the firms and the relevant agencies supervising them to be alive to their responsibilities in the interest of the consumers.

– Punch

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