Electricity Tariff: Experts Warn Against Exploitation, Hint Legal Action

Experts have warned about the exploitation of Band A users by electricity suppliers if not defined and regulated by the Nigerian Electricity Regulatory Commission (NERC).

Musilu Oseni, the NERC Vice President announced a 300% in Abuja on Wednesday stating that the increase would only affect 15% of consumers.

Speaking to NAN, Chinedu Amah, founder of Spark Nigeria Ltd., Lanre Elatuyi, an electricity market analyst, and Adeola Ilori, the national coordinator of the All Electricity Consumers Protection Forum, condemned the sudden tariff hike, asserting that the increment should have followed due procedures mandated by law.

Hinting at legal action, they inquired if the Band A customers would receive the promised Hours of electricity supply and how it would be monitored to ensure non-exploitation by Discos.

Meanwhile, Oseni in an interview with Channels TV revealed that if nothing is done to ensure tariffs are reviewed, the market can be relatively liquid.

He said, “If you look at section 116 subsection 2A of the electricity act, it mandates the commission to ensure that the licenses operating efficiency are allowed to recover sufficient revenue for the capital invested and for the operational cost as well as having a return on the investments they have made.

“In that case, it means that the onus is on the commission to ensure that operators actually earn sufficient revenue that we incentivize further investments to ensure improvement in service delivery.

“What informed the decision apart from the provision of the act, in December 2023, there was an improvement in the quality of service down to January. From then on there was a dearth in electricity availability. The lack of review of tariffs caused that.

“The Discos could not be mandated to forward what they had not been allowed to charge. For that, the payment to the generation companies has significantly dipped which affected their ability to maintain their machines and to pay for gas. And gas is one of the two significant raw materials for electricity generation in Nigeria.

“At a point, it is clear that if nothing is done to ensure the tariff is reviewed the market can be relatively liquid.”

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