While we were asleep on Tuesday 5 January, 2021, they did what they would rather do. Sneak in on us!
Negotiations were yet ongoing between the Trade Union Congress (TUC) and government over the last increase in electricity tariff, the National Electricity Regulatory Commission (NERC) suddenly announced another increase in tariff of 50%.
Nigerians seem to be getting a little less worried about not being told of these kinds of decisions, but can’t stop being shocked at how the NERC would just do that. Or, is it too hard for them to realize just how much even the formal increment met so much difficulty for Nigerians?
And then, to “sneak” in an increase of 50% on citizens who, I would say, were just trying to settle down after the festivities, and having spent a lot of money. Was that the right time to increase electricity bill rates? It would seem because we cannot ask questions so we are dished anything that’s cooked behind us.
The NLC true to duty is standing their ground, “reverse this hike in tariff or, we go on strike”, they have said (in my own words).
The NLC is particularly unhappy with the seeming lie by the NERC, which on one hand denied there was an increase, and on another announced ‘’an adjustment’’ of tariff from N2 per kilowatt/hour to N4 per kilowatt /hour.
What?!!! Are you kidding me?!!!
At least, just tell us the truth! But, we don’t accept even the increase in tariff. Period!
Nigeria started Electricity generation in 1896. However, the first electric utility company was established in 1929, known as the Nigerian Electricity Supply Company. By the year 2000, a state-owned monopoly, the National Electric Power Authority (NEPA), was in charge of the generation, transmission and distribution of electric power in Nigeria.
In 2001, the reform of the electricity sector began with the promulgation of the National Electric Power Policy which had as its goal the establishment of an efficient electricity market in Nigeria. It had the overall objective of transferring the ownership and management of the infrastructure and assets of the electricity industry to the private sector with the consequent creation of all the necessary structures required to form and sustain an electricity market in Nigeria.
Since privatization, the electricity sector has recorded some milestones including an Increase in installed capacity for power generation and some roll out of meters and modest progress to boost utility revenues.
With some of these dreams unattainable, GenCos and DisCos became unable to recover costs, they were then unable to repay the $780 million borrowed from Nigerian banks for the initial purchase in the privatisation. They lost luck with the banks. What this has meant is, they fend for themselves somewhat.
As part of survival and wriggling out of some of these challenges, there came the necessary need to settle the outstanding seventy-five percent (75%) to complete the transaction and expand metering.
As regards Tariff, the federal government through the NERC in September 2020 increased electricity tariff from 30.23 Naira for one kWh (kilowatt unit of energy per hour) to as much as 62.33 Naira per kWh.
This new system of billing known as ‘Service Reflective Tariff’ meant that consumers would pay electricity bills according to the hours they enjoy energy supply. DisCos are to begin charging the new tariff plan immediately.
This increment was met with a lot of complaints and resistance from Nigerians, who said the increment was to the detriment of the citizens, citing the harsh blow by the effects of Covid 19 and how badly the economy was affected.
Another big complaint was the lack of enough electricity supply. One man who spoke to the BBC Pidgin was quoted to have said, if the NERC and DisCos would ensure steady supply of electricity for 24 hours, then an increase in Tariff would be no issue. But the situation of low electricity supply at the time wasn’t right for that decision at all.
Taking the amount of power generation and distribution, Nigeria cannot be regarded as one of the world’s top 20 economies, although the Nigerian Minister of power, Babatunde Fashola has alluded that the sector has enough power generation, saying that, the problem is just distribution.
The government suspended the increase in tariff when the effects of Covid19 became too evident. Members of the national assembly backed the suspension, asking electricity distribution companies to stop the plan until the first quarter of 2021.
Just as the increase in 2020 was ill timed, this also was a horrible time for such a decision. Nigerians had yet to recover from the end of year festivities and were still trying to settle down.
The NLC had good reasons to reject this new tariff hike, citing the effect that it would have on the labour market. A loss of jobs by many people was looming. Newspaper headlines of 11th January 2021 screamed of how banks have announced trimming of staff as well as closing down non sustaining branches due to increased cost of power.
It’s been a little less than two months since a controversial tariff hike was introduced last year. So, this new increase came as a shocker to many Nigerians. It reflected a somewhat lack of care by the government for its citizens.
This increment in tariff has sparked a lot of reactions as the masses have started showing their frustrations.
*Ms Asough wrote from Abuja
