Electricity tariff to increase on Wednesday despite COVID-19 lockdown

Arrangements have been perfected for Nigerians to pay more for electricity starting from this Wednesday, April 1, 2020, in addition to the impending hardship posed by Covid-19 lockdown, according to reports by available to 9News Nigeria correspondents.

Recall that the Nigerian Electricity Regulatory Commission had disclosed this in its December 2019 Minor Review of Multi-Year Tariff Order 2015 and Minimum Remittance Order for the Year 2020.

In effort to further verify this plan by the Electricity Distribution Companies to increase electricity tariffs, 9News Nigeria discovered that the Nigerian Electricity Regulatory Commission had not officially suspended the plan in spite of earlier promise despite citizens’ agitations over COVID-19 lockdown.

According to a source from one of the major Electricity Distribution Companies in Lagos, they will proceed with the plan to increase electricity tariffs since there have not been any official directives to stop the initial plan.

He said, “According to the tariff order for the year, we are supposed to increase on April 1, 2020. So far, we have not received any directive not to go ahead.”

Efforts made by other news reporters to speak on the matter with senior officials of the Nigerian Electricity Regulatory Commission proved abortive.

The spokesman for the commission, Usman Arabi, said Monday that he was not around but on a course at the National Institute for Policy and Strategic Studies.

Arabi’s substitute, however, did not respond to calls or a text message sent to him by reporters.

NERC had disclosed in its December 2019 Minor Review of Multi-Year Tariff Order 2015 and Minimum Remittance Order for the Year 2020 that the order was issued to reflect the impact of changes in the minor review variables in the determination of cost-reflective tariffs and relevant tariff and market shortfalls for 2019 and 2020.

The commission said the order also determined the minimum remittances payable by the distribution companies in meeting their market obligations based on the allowed tariffs.

It said, “The Federal Government’s updated Power Sector Recovery Programme does not envisage an immediate increase in end-user tariffs until April 1, 2020, and a transition to full cost reflectivity by end of 2021.

“In the interim, the Federal Government has committed to funding the revenue gap arising from the difference between cost-reflective tariffs determined by the commission and the actual end-user tariffs payable by customers.”

According to NERC, all Discos are obligated to settle their market invoices in full as adjusted and netted off by applicable tariff shortfall.

It said, “All FGN intervention from the financing plan of the PSRP for funding tariff shortfall shall be applied through NBET and the market operator to ensure 100 per cent settlement of invoices issued by market participants.

“Effectively, this order places a freeze on the tariffs of the TCN and administrative charges until April 2020 at the rates applied in generating MO invoices for the period of January to October 2019.”