15 July 2017, Sweetcrude, Abuja – The former chairman of the Nigeria Electricity Regulatory Commission (NERC), Dr. Sam Amadi, has said ex-President Goodluck Jonathan did not order the reversal of electricity tariff in 2014.
In the build-up to the 2015 general election, the commission announced an increase in electricity tariff, but it later suspended the action.
Speaking at a public lecture in Lagos on Thursday, the Minister of Power, Works and Housing, Mr. Babatunde Fashola, accused the Jonathan government of ordering a reversal of electricity tariff in order to win electoral votes.
But in a statement issued on Friday, Amadi said he and his colleagues at NERC took the decision to suspend the action.
He also said Jonathan never dictated policy to the commission, and that he was determined to ensure the independence of the regulator.
“I have read some piece of news suggesting that President Jonathan ordered the reversal of electricity tariff during his tenure as president. Since I have left office I have avoided issues about electricity regulation in Nigeria to give our successors the best opportunity to do better than we did,” he said.
“My understanding of public office that the best a former public officer should do is to truly step aside and be willing to provide advice if and when it is needed. In the best tradition of public service, you don’t obstruct the new administration.
“But I am constrained to restate the truth of what happened for the purpose of ensuring proper information to enable the present administration to do their best to fix the electricity crisis. Throughout our five years as commissioners of NERC, there was no single day that President Jonathan ever dictated or instructed policy to the commission concerning any issue on electricity regulation.”
Amadi said Jonathan was a great president to the electricity sector and that he found him very understanding.
He also said all tariffs issued from 2010 to 2015 did not require the approval of the former president.
“On the matter of the tariff, the facts are straightforward and borne out by records. NERC as a regulation has a comprehensive methodology and business rules for regulating tariff. The act, methodology and business rules put the responsibility on NERC commissioners who vote democratically for every such decision, just like the board of governors of the Central Bank of Nigeria (CBN) does for monetary policies,” he explained.
“Every tariff we have issued from 2010 to 2015 did not receive or require the approval of the president. Only NERC commissioners approved them.
“I am prepared to take slacks for any intended or unintended consequences of that decision as the chairman and chief executive of NERC. I still strongly believe that my reading of effective regulation confirms that it was a good decision to internalise efficiency in the distribution segment of the electricity industry.
“President Jonathan played no role at all in that decision. His ministers did not play any role. It was a bona fide regulatory decision that may be termed wise or unwise, after the facts. But should not be used to denigrate President Jonathan or the ministers of power.
“But for now, take it from the horse’s mouth: Jonathan did not reverse any tariff. Sam Amadi and his colleagues changed the tariff through the normal due process and as part of the effective regulation of the sector.”
Fashola, who was speaking at a public lecture organised by the department of economics, University of Lagos, had stated that the Goodluck Jonathan-led government reversed electricity tariff “to win electoral votes”.
He said the privatisation of the country’s power sector was delivered with “some deception”.
According to the minister, after the privatisation process was concluded, the previous administration failed to explain to Nigerians that a lot of work was required.
The minister noted that the reduction of electricity tariff created “massive debt” for Nigeria as it did not conform to the realities of the country’s economy.
“While I fully support privatisation, I believe what took place in 2013 in the heat of politics was a privatisation that was well intentioned since 2005 but delivered with some deception in 2013 with the expectation of political profit,” Fashola said.
“It led many uninformed Nigerians to believe that once the privatisation was concluded, the assets sold to the distribution companies (Discos) and the Generation companies (Gencos) there was immediately going to be power. I cautioned then that people’s expectations were being unduly raised without telling them that there was a lot of work to do.
“Government must also not interfere with the power of the regulator when it fixes tariff in the way the last administration ordered a reversal of tariff in order to win electoral votes in 2014.
“It created a massive debt for Nigeria because while the government ordered a reversal of tariff, it did not reduce exchange rate, interest rate, the cost of wages or cost of gas and other inputs necessary to produce power. Why should Nigeria carry a debt created by an individual’s electoral ambition? This is what the Buhari administration has to contend with.”