Why National Assembly stops Distribution Companies from Increasing Electricity Tariff

Sen. Gabriel Suswan (PDP-Benue) says the National Assembly directs the Electricity Distribution Companies (DisCos) not to increase electricity tariff because of the current economic challenges occasioned by COVID-19 pandemic across the country.

Suswan, Chairman, Senate Committee on Power, made the disclosure in an interview with the News Agency of Nigeria (NAN) in Abuja on Thursday.

He said that the increase in the tariff had to stop for now even when it was obvious that an increase, given the provision of necessary distribution infrastructure in the electricity market, would help the sector to be solvent.

He noted that an increase in electricity tariff in this period would worsen the economic hardship faced by Nigerians, hence the intervention of the National Assembly to prevail on the DisCos to suspend the increase until first quarter of 2021.

“Under a normal situation, increase in tariff increase will help the operators to meet their remittances 100 per cent and government will not need to subsidize.

“Now government all over the globe are giving palliatives to their citizens; in America for instance, most of the people who fought for palliatives for not being employed receive some stipends weekly.

“Now, here we have people who are unable to feed family because of the COVID-19 pandemic and DisCos is saying it will increase tariff at the same time; we are saying yes, cost reflective tariff is the way to go because we need the sector to be solvent, but the timing is not auspicious.

He also explained that the government had also reduced petrol pump price because it did not want to increase burden on Nigerians, observing that it would not make sense if DisCos increased electricity tariff.

“In the interim, government will continue to subidize petrol pump price  because that is the responsibility of government, no government will want a situation where their citizen would be overburdened with prices of goods.

“So, that was why we stepped in and good enough with the decision we took, the president has agreed with us and said they should not activate the increase until certain things are in place,” he explained.

By Gabriel Suswam | News Agency of Nigeria – (NAN)