|
|
Nigeria: No Electricity Tariff Increase for Now - NERC
 |
|
|||||||||
|
||||||||||
Leadership (Abuja)
4 July 2008
Posted to the web 4 July 2008
Jerry Uwah
Abuja
Nigerian Electricity Regulatory Commission (NERC) has assured electricity consumers that the tariff increase which came into effect on July 1, 2008 would not be passed on to consumers by way of higher bills.
NERC's Executive Commissioner, Dr. Grace Eyoma, told LEADERSHIP in a telephone interview yesterday that the difference between the new tariff and the old one would be paid by the Federal Government by way of subsidy through the power consumer assistance fund.
The Power Holding Company of Nigeria (PHCN) on Tuesday July 1, 2008 adjusted electricity tariff from a maximum of N6 to N11 per kilowatt hour, sparking off speculations that the 95 per cent increase would be reflected in consumers bills at the end of this month.
However, it would be recalled that on April 14, 2008 the Chairman/Chief Executive Officer of NERC told media executives in Lagos that the Federal Government had agreed to settle the contentious issue of low electricity tariff which has kept the private sector from investing in the nation's power sector, by setting up a consumer assistance fund through which electricity tariff would be subsidized to acceptable market levels that would enable investors recoup their money and make profit.
The tariff subsidy which would run for three years would cost the Federal Government an estimated N177 billion. It is designed to make investment in the power sector bankable.
Electricity tariff in Nigeria was last reviewed upward in 2002 when it was raised to the current rate of N6 per kilowatt hour.
Despite massive increase in the cost of other utilities, government has been very reluctant to effect an upward review of electricity tariff apparently due to political expediency. Power supply in the country has been epileptic over the years making an upward review of tariff a very sensitive issue in view of its potential for fueling inflation and worsening unemployment problem.
The view of the general public has been that upward review of tariff could only be effected when there is tremendous improvement in power supply. A school of thought however, believes that an end to epileptic power supply would never come if private sector investment is not attracted to the industry.
|
The belief that Nigerians would stubbornly resist any attempt to raise electricity tariff under the current deplorable supply situation and the realisation of the fact that current tariffs could not attract private sector investments, compelled the government to accept to foot the bill of a tariff increase until power supply to consumers stabilises.
| |||||||||||||||||||||||||||||
| |||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||
| Copyright © 2008 Leadership. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections -- or for permission to republish or make other authorized use of this material, click here. | |||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||
| Make allAfrica.com your home page | RSS Feed | |||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||
| Top | Site Guide | Who We Are | Advertising | Search | Subscribe | |||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||
| Questions or Comments? Contact us. Read our Privacy Statement. | |||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||
|
| |||||||||||||||||||||||||||||
