Oscarline Onwuemenyi
22 July 2017, Sweetcrude, Abuja – The House of Representatives has decried the rising electricity tariff which it described as unjustifiable considering the commitment of N213 billion to the operators.
It said that the government had injected huge amount into the wobbling power sector to boost supply to Nigerians.
Besides, the House said the increment was not in tandem with the economic realities of the country where Nigerians were facing hardship.
The condemnation is sequel to a motion by Rep. Shehu Musa on the “need to evaluate the multi-year tarried order system of electricity tariff in Nigeria.”
Moving the motion, Musa recalled that in 2008, Nigeria Electricity Regulatory Commission (NERC) adopted Multi-Year Tariff Order (MYTO) methodology to regulate electricity tariff and the tariff setting, in consultation with stakeholders, labour and consumers.
He said it was to provide correct pricing of electricity, taking into consideration the key principles of cost reflectivity, affordability, incentives for efficient operations and other assumptions, including tertiary rates, exchange rates, inflation, gas prices and subsidies.
According to him, the new tariff regime continues to increase from an average of N10 per kwh in 2007 to an average of N24.20 per Kwh in 2017 without significant improvement in power supply.
“We are concerned by the quantum of public outcry over the continuous increase in the unit price of electricity set under this new tariff regime. This is in spite of the N213 billion Nigerian Electricity Market Stabilization Fund provided by the Federal government as subsidy to the industry operators.
“We should be concerned that even the presently fixed price unit of electricity is said to be under-priced and that plans are underway to gradually increase the tariff to cover full costs
“Equally of concern is that the tariff is not in tandem with economic realities of Nigeria, coupled with attendant hardships being experienced by Nigerians due to the collapse of small and medium-scale businesses and industries,” Musa said.
After contributions by members, the motion was unanimously adopted.
The house therefore mandated an ad hoc committee to interface with NERC and other stakeholders to critically evaluate the MYTO system.
The committee will also re-assess all its inputs and assumptions in order to come up with a realistic tariff regime and report back to the house within six weeks.
