Small Business Owners and civil society organisations, NGOs, have said there is no justification for the proposed further hike in electricity tariffs, following disclosure by the federal government, yesterday, that it is considering increasing tariffs for customers outside the Band-A category to improve the liquidity of the Nigerian Electricity Supply Industry, NESI.
Minister of Power, Chief Adebayo Adelabu, who disclosed this at the public presentation of the National Integrated Electricity Policy, NIEP and Nigeria Integrated Resource Plan, NIRP, in Abuja, said government can no longer afford the N3 trillion power sector subsidy.
He pointed out that debt owed power generation companies, GenCos, had risen to N4 trillion and is unsustainable, reports Vanguard.
According to Adelabu, “The key issue in the market is illiquidity, and sector reforms, we’ll continue to focus on that. We will look at the tariff again. I’m not saying that we’re going to increase the tariff.
“We are going to look at the tariff and see how we can improve on our modest achievement of last year. Not only to ensure that we grow the sector revenue, but to also ensure that we are able to invest more in revamping dilapidated infrastructure, so that the infrastructure carries the kind of reliable electricity that we envisage for the sector. We will look at it.”
He noted that with Band-B customers receiving about 18 hours of electricity supply and paying N63/kW, the gap between this category of customers and Band-A customers has become problematic. Speaking on the two documents, he said: “Collectively, the NIEP and the IRP present a unique opportunity to drive the transformation of Nigeria’s power sector through a data-driven and evidence-based approach.
“Beyond strengthening the sector, these frameworks have far-reaching economic implications, directly impacting supply reliability to small and medium-sized enterprises (SMEs) and large industries, reducing operational disruptions caused by power shortages, fostering economic growth and job creation, and accelerating local and regional development.”
The documents showed that government plans to phase out delayed electrification and self-generation phaseout by 2035.
But for this to happen, government expects about $29.23 billion investment into the sector. These investments are expected to hit $122 billion by 2045.
Adelabu harped on the need to strengthen the national power grid and make it more robust and able to attract manufacturers back to the sector.
He noted that 60 per cent of manufacturers in the country are into self generation due to the fragile nature of the grid.
In her remarks, Head of Economic Development at the Foreign, Commonwealth and Development Office, FCDO, Sally Woolhouse said the United Kingdom government had supported the Nigeria Power Sector with about £200 million.
Woolhouse noted that the UK Nigeria Infrastructure Advisory Facility, UKNAIF, has been the vanguard of providing technical advisory support to state and federal government ministries, departments and agencies in Nigeria’s electricity value chain. She added that the shift towards work in state electricity markets, presents new opportunities in the power sector.
According to her: “It should be obvious to everyone that the UK and Nigeria enjoy a long-standing relationship and we are proud to continue supporting first class infrastructure development that leads to sustainable economic growth and also helps us build mutually beneficial strategic partnership for both of our countries.”
Further tariff hike will kill small businesses — ASBON
Meanwhile, President of Association of Small Business Owners of Nigeria, ASBON, Dr. Femi Egbesola, has said any further increase in electricity tariff will lead to the death of many small businesses in the country.
“Majority of SMEs are dependent on electricity supplied by government and further hike in tariff will definitely lead to inflation, low sales necessitated by high cost of production, which may ultimately lead to ailing or death of some businesses, particularly micro and small businesses, which are the most vulnerable,” he stated.
We‘ll resist further hike — CSOs
Reacting, Education Rights Campaign, ERC, said: “Any thought of increment in electricity tariff for any band of customers will be met by a determined mass resistance of the Nigerian people.”
ERC’s National Coordinator, Hassan Taiwo, told our correspondent that “The federal government should immediately forget about increasing electricity tariff. Any thought of increment in electricity tariff for any band of customers will be met by a determined mass resistance of the Nigerian people.
“This is for no other reason than the fact that as it stands today, power supply has not improved for the vast majority of the population who still suffer daily power cuts amidst other incidents of poor service delivery.
“Over the past one year, Nigeria has experienced almost bi-monthly incidents of collapse of the power grid. So, what would be the moral justification for an increase in electricity tariff for any band of customers more so non-Band A customers who occupy the lowest rung for consideration when it comes to the quality of service delivery by Electricity Distribution Companies, DISCOs. Aside this, the Nigerian masses are yet to recover from previous increases.
“As it stands now, payment for electricity takes a significant chunk of people’s monthly income leaving them with very little to survive. Apart from individuals, many companies are folding up due to inability to meet the huge burden of electricity bills. This extends to vital government institutions including hospitals. The example of UCH Ibadan is there. For several months now, UCH has had no electricity supply leaving patients and medical professionals in a bad place due to inability to pay their bills.
“Going by this tale of woes caused by previous increase, another electricity tariff hike risks triggering a shut-down of the whole country and it is for this reason that any further attempt to make life unbearable for the people by increasing electricity tariff will be resisted.”
Profiteers raking profit with little invested in generating more power — MSA
Similarly, the Movement for Socialite Alternative, MSA, rejected any further hike in electricity tariff.
Its General Secretary, Dagga Tolar, told our correspondent that the group “had outrightly pointed out that the Band A’s apartheid discriminative increase in tariffs was a test-run to divide consumers against themselves, while falsely creating the impression that DISCOs have the capability of supplying 24 hours round the clock electricity for consumers. When in reality, what was at play was denying the rest of all of us our right to electricity to feed a few, who can pay.
“Interestingly, this false has gained ground, with those abreast of the fact calling and insisting that “BAND A”, should be allowed to stay. But alas, with government now out to increase and Band A every consumer, the cat is out of the bag. The ruling class, which had privatised electricity for close to a decade and half, continued to be the major player, in terms of investments, with the private profiteers just raking billions of profit with little or nothing invested in generating additional megawatts for the country.
“In the past one year, the national grid collapsed over and over, with nothing done to remedy or prevent same from repeating itself. Even this on its own is enough judgment for the government to nationalise electricity supply under public ownership and democratic management of electricity workers, consumers and government.
“Currently, electricity workers face the worst of working conditions, poverty wages, a majority of staff function as casual labour, with DISCOs refusing to respect any of the known labour laws of the land. It is clear we cannot continue like this. The Tinubu regime is proving to be in power to defend the interest of private profiteers and members of the billionaire club to the detriment of the welfare and well-being of working masses.
“From fuel to gas, telecommunication to electricity, food items, to rents. We witness an unending rise in prices. With inflation at double digit of 34 per cent the working masses are left at the worst end. To continue to agonise, without stepping out to organise a resistance will worsen the living conditions in t Nigeria. We call on the working masses to independently begin to take necessary initiatives to organise and resist this paying for darkness to enrich the few.
“We commend members of the Ajegunle People Movement, who last Monday began a series of mobilisation in this regard. Others must follow suit. The National Union of Electricity Employees, NUEE, must not stand arms akimbo, it must take the necessary step to mobilise workers and engage in a public campaign for electricity to be returned to public ownership.
“Indeed the Nigerian Labour Congress, NLC and the Trade Union Congress of Nigeria TUC, must also swing into action, a 24 hours warning general strike that takes all the issues, and as well as immediately commence a new agitation for a new minimum wage not less than N200, 000 a figure to march the rate of inflation. Ultimately, the working masses must organise to end the dominance of our wealth and resources by private profiteers.”
NERC introduces customer Bill of Rights
Meanwhile, in an effort to protect electricity consumers and ensure fair service delivery, the Nigerian Electricity Regulatory Commission, NERC, has launched the Customer Bill of Rights and Obligations for consumers within the NESI.
A statement by Mr Pious Bakom a senior Manager with NERC, yesterday, said: “Customers are also entitled to clear information regarding electricity rates, terms of service, and connection procedures.
“To ensure the smooth functioning of the electricity supply system, the Bill also outlines specific obligations that customers must fulfill. These include the timely payment of bills, granting access for meter installation and maintenance, compliance with safety regulations, and reporting any unauthorized use or tampering with meters.”
NERC further advised customers to inform their respective distribution companies (DisCos) vacating or occupying a premises to avoid liability for outstanding bills.
“NERC emphasised that the Customer Protection Regulations (CPR 2023) were introduced to bring Nigeria’s electricity service standards in line with global best practices. The commission urges consumers to familiarize themselves with their rights and responsibilities, contributing to a more transparent and accountable electricity market.”
