Suspending electricity tariff costly for Nigeria, Discos tell senators

17 February 2016, Abuja – The 11 electricity distribution companies (Discos) in Nigeria’s power sector on Wednesday warned that an order by the Nigerian Senate asking the Nigeria Electricity Regulatory Commission (NERC) to suspend their implementation of the new electricity tariff it recently approved for them will come with consequences that the Nigerian economy may not be able to bear.

*Electricity sub-station.

*Electricity sub-station.

The Discos said this through their umbrella union, the Association of Nigerian Electricity Distributors (ANED) in Abuja.

They explained in a statement from ANED’s Executive Director, Advocacy and Research, Sunday Oduntan that an implementation of the Senate’s resolution will not be without consequences.

The NERC had approved for the Discos new retail electricity tariffs for various consumer classes within their network under the Multi Year Tariff Order (MYTO-2).

The new tariff system became operational on February 1, however it has so far elicited harsh reactions especially from organised labour which took to the streets across the country last week in protest of same.

In their protest, labour was able to get the support of the Senate which subsequently directed NERC to suspend further implementation of the rates.

But listing the impacts such order could generate, ANED said that it had a prior agreement with the federal government before the privatisation exercise that a market-priced tariff which reflects its costs of distributing electricity to consumers would be enthroned in the sector.

It explained in this regard that the Senate’s order was in disregard of the agreement and that it raises concern on sanctity of contract in the country.

 

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