11 February 2017, Sweetcrude, Abuja – The Nigerian Electricity Regulatory Commission has said many factors were responsible for tariff review in the country bi-annually.
A statement by Dr. Usman Arab, NERC’s Head of Public Affairs, in Abuja, said the allegation that the commission always sided with operators on tariff issues was not true.
Arab said one of the duties of NERC was to protect the interest of consumers and investors on electricity pricing and supply.
According to him, by law NERC is mandated to provide a cost reflective tariff for the operators based on prudent costs.
Arab said: “NERC has never at any time stated that only an increase in electricity tariff will guarantee steady power supply in the country.
“The commission had maintained that the further increase in tariff was not imminent given the present economic recession in Nigeria.”
He also said that the poor remittance level by Discos, multiple restraining orders from the courts as a result of litigations had also checked the increase in tariff.
He said that pricing methodology mandated the commission to carry out a minor review of the tariff bi-annually and adjust the exogenous factors that were beyond the control of the investors and the regulators.
Arab said that the macroeconomic indices such as the rate of inflation and exchange rate had steadily gone up over the last one year.
The commission said that this had affected the prices of all other commodities in the country.
He explained that inflation and exchange rates were bound to trigger the need for electricity tariff given the fact that all equipment used for the generation, transmission and distribution of electricity were imported.
Arab said that the commission in recognition of the importance of protecting the interest of electricity customers had set up complaint forum offices nationwide with over 10 more to be opened this year.
He assured the general public and investors that the challenges in the power sector were transitory.
Arab reiterated that a comprehensive proposal by the Minister of Power, NERC and other stakeholders had been developed to effectively resolve the challenges in the sector.