From Princely Onyenwe
The perceived plans of government to venture into Energy Subsidy is likely to cause a new sudden shock on the increase of Electricity Tariff in Nigeria.
Stakeholders in the Electricity supply and power told 9News correspodent that with a monthly subsidy of about N50 billion still in the electricity sector owing to revenue shortfall, the tariff hike due from July 1, will shock the people.
This however may be another acid test for the President Bola Ahmed Tinubu administration’s market reform pending it’s resolve.
Therefore, Nigerians may need to prepare for tougher times as electricity tariff is set to increase by over 40 % in the coming days, a development which may eventually end all forms of energy subsidy in the country.
Recall that the Tinubu’s administration has already removed subsidies on Premium Motor Spirit (PMS)& floated the naira, decisions that have complicated the price-setting of the NERC 2022 Multi-Year Tariff Order (MYTO).
Although the power sector players have been unable to meet the threshold of supplying at least 5,000 megawatts a year after signing contracts with NERC, NERC’s current Service Based Tariff was benchmarked on an exchange rate of N441/$ & inflation of 16.97 %
While speaking with 9News correspodent, an anonymous stated that electricity tariff is a creation of PDP/ Obasanjo’s administration that signed NERC into law.
“The law is clear on how tariffs will increase or otherwise. President has no role again. The issue is with NERC chairman who has the power to approve an increase.
“Before the increase, they held public sector stakeholders meeting but as usual, no one paid attention to it. This is the law and the rule.
“If you are not comfortable ask your Senator/ MHR to amend the law. But in a long term tariff will reduce when we have more electricity firms and Naira is strengthened.
“What is the alternative? The Chairman can suspend the tariff and gives more money to discos to shore up their finances.
“Discos are in business because discos are buying equipment and parts from the same forex market. Discos will collapse if they do not have enough liquidity. Discos can’t enjoy preferential forex rate again.
“So if you suspend, you must give succor to Gencos and Discos. Whatever you called it, electricity subsidy will increase. Wahala dey.
A government official who frowned at this development stated that there are so may disjointed policies or laws in Nigeria while adding that NERC should first ensure all homes and businesses are given a prepaid meter before increasing the tariff.
Why must government parastatals keep giving Nigerians stress. He concluded.
Nigerian citizens have frowned at this upcoming energy subsidy and possible increase on Electricity Tariff while calling on President Tinubu to help out.
9News Nigeria (Owerri) For inquiries on this news contact 9News Nigeria Imo State @08036856526
