National

Again, FG Hikes Electricity Tariff By 50%

 While Nigerians are yet to come to terms with the last increase in electricity tariff, the Nigerian Electricity Regulatory Commission, NERC, has approved over 50% hike in electricity tariff effective January 1, 2021.

The new tarrif hike regime is to be paid by customers of the 11 electricity Distribution Companies, DISCOs.

This is coming just two months after the Commission forced implementation of the much-opposed hike on Nigerians in November 2020.

A revised MYTO (multi year tarrif order) and minimum remittance threshold payable by the Distribution Companies and signed by NERC Chairman, Sanusi Garba, empowers the 11 DisCos to increase tariff by 50 per cent.

The document dated December 30, 2020 overruled the previous order Order NERC/2028/2020.

In the new Order NERC/225/2020, the commission said it considered the 14.9% inflation rate rise in November 2020, foreign exchange of N379.4/$1 as of December 29, 2020, available generation capacity, US inflation rate of 1.22% and the Capital Expenditure (CAPEX) of the power firms to raise the tariff.

The revised Service Based Tariff (SBT) also saw increase in the rates payable by all classes of electricity users unlike the one of November 2020, that exempted low power getters.

In the new order, tagged NERC/225/2020, all classes of consumers, except those who enjoy a few hours of power supply would pay more for electricity until June this year.

A Cost Reflective Tariff (CRT) expected to raise the new cost higher will be activated for all consumers from June to December 2021, the NERC Order revealed.

Recall NERC, earlier in December, 2020, notified that it had begun a review for another tariff, which has been completed and had taken effect from January 1, 2021.

NERC had raised tariff for the DISCOs in September but that drew outrage from customers and the organised labour, prompting the Federal Government to suspend it to pave ways for parties to dialogue.

Subsequently, by November 1, 2020, the suspended tariff was implemented after some discounts were given for customers who get 12 hours and above power supply daily.

Labour unions and the Federal Government had been at loggerhead following increase in the pump price of premium motor spirit as well as the increase in electricity tariff.

After series of outrage and outright rejection by consumers who cited poor power supply and the impacts of Covid-19, DisCos had in October last year started the implementation of a service-based reflective tariff (SRT) structure after backing by an approval from President Buhari.

Source: thewillnigeria.com