The implementation of a new tariff by the electricity distribution companies (DisCos) across Nigeria, has stoked a controversy with the operators, as consumers refuse to accept the increment, calling for its reversal.
The 11 DisCos had rolled out an electricity tariff template to implement a new service reflective tariff, which will see some consumers pay an average of N67 per kilowatt-hour of energy consumed, up from N24.
The DisCos said that electricity customers, except those receiving less than 12 hours of supply, would have to pay more. With the review, the tariff being charged residential consumers that receive a minimum of 12 hours of power supply has increased by over 70 per cent.
In a statement on August 26, and signed by the Chairman, James Momoh, the Nigerian Electricity Regulatory Commission (NERC), had directed the DisCos to engage with their customers on a service-based tariff structure.
Momoh said under the service-based structure, DisCos can only review tariffs for customers only if customers are consulted and communicated a guaranteed level of electricity service based on hours of supply; customers are metered and no estimated billing through the strict enforcement of the capping regulation.
“This means that unmetered customers will not experience any cost increase beyond what is chargeable to metered customers in the same area. Even under the above conditions, there will be no change in tariffs for the most vulnerable, as tariffs for those consuming 50KW or less remain frozen.”
But stakeholders have expressed misgivings on the directive, saying the above criteria were not met by the DisCos before the increment was announced.
Specifically, the National Coordinator, All Electricity Consumer Protection Forum, Adeola Ilori, expressed disappointment on the hike. He lamented that the provision or preconditions mentioned by the NERC have not been adhered to within the last three days to the issuance and the release of increase on the same day.
“An area is supposed to be charged N53 per unit for experiencing 20 hours supply of power, and they are to be so billed. The question is: who determines the hours supplied – the consumers or the DisCos? That is the beginning of estimated billing recently repealed by order 197/2020 by NERC on February 20, 2020, which established capping as a new billing methodology.
“Again, we wish to remind the DisCos of the NERC order 197/2020 indicated in Paragraph A, on estimated billing and that in order 198/2020 of 2020 informing the stakeholders of increase in tariff postponement. The stakeholders’ forum is not in agreement with the increase in tariff until improvement is seen, which is also in tandem with Section 76 subsection 2, Paragraph B of the Electric Power Reform Act 2005, to the effect that no increase in tariff will be approved until improvement in supply become feasible and consumers are metered.
The group demanded the immediate reversal of the tariff increment and the full implementation of the capping method order. They also tasked NERC to show why consumers should believe they are protected and that all their actions are in tandem with Section 32 of the Electric Power Sector Reform Act, 2005, which emphasised fairness to all stakeholders in the sector, including the consumers.
The Ibadan Electricity Distribution Company (IBEDC), in a chat with The Guardian, explained that the increment was in efforts to deliver excellent service to its customers.
The Chief Operating Officer (COO), IBEDC, John Ayodele, an engineer, said the new tariff is commensurate and aligned with the quality and availability of power supply committed to each cluster of customers under the Service Reflective Tariff.
He argued that the review is critical to the provision of more efficient and reliable service to customers, upgrade aging infrastructure, and be more responsive to the complaints of the customers.
“The new tariff plan will not only empower us to provide better service, but it will also promote fairness. We, therefore, appeal for the understanding and cooperation of our esteemed customers as we commence the implementation of the Service Reflective Tariff through prompt payment of electricity bills and vending, as we are resolutely committed to delivering improved and better service.
Also, Eko Electricity Distribution Company (EKEDC), in a statement signed by its Corporate Communications General Manager, Godwin Idemudia, said the review is aimed at projecting a service reflective tariff that will enable it to invest heavily in infrastructure.
He explained that the company understands the timing of the upward review, considering the on-going pandemic, but appealed to customers that it is imperative to improve the quality of service. He further said the new tariff would be strictly service-based, as customers are expected to pay tariff based on the electricity supply available to them.”
