Mr. Babatunde Irukera, Chief Executive Officer, FCCPC

Consider electricity consumers’ plight in tariff review, FCCPC urges NERC

* Ensure regular electricity supply, justify value for consumers’ money ─Irukera

* 52 percent of 1o million electricity customers on estimated billing ─NERC Chairman

Isola Moses | ConsumerConnect

With regard to the riveting uproar generated by NERC’s latest directive to all 11 electricity Distribution Companies (DisCos) to jack up electricity tariffs with effect from April 1, the Federal Competition and Consumer Protection Commission (FCCPC), in Nigeria, has admonished the Nigerian Electricity Regulatory Commission to think of the plights of consumers in the proposed review of electricity tariffs.

Mr. Babatunde Irukera, Chief Executive Officer (CEO), FCCPC, made the plea at a public hearing on an application by Eko Distribution Plc to NERC for “Extraordinary Tariff Review Pursuant” to the Commission Tuesday, in Lagos.

The News Agency of Nigeria reports that the Eko Distribution requested a proposal for upward review in electricity tariffs at the hearing.

According to Mr. Irukera, the proposal for increment in tariffs would not be appreciated by electricity consumers due to epileptic power supply being experienced in the country.

There was a need to ensure regular electricity supply to justify the value for money paid by customers if they were to embrace the tariff review, he posited.

The FCCPC CEO stated that the real thing is not what consumers are willing to pay, but they need to understand that an equilibrium level should be achieved.

He explained that the equilibrium level exists only when the effective power supply exists, and that makes consumers willing to pay for the services they enjoyed.

Irukera also noted that the DisCo would have to address the issues of metering and estimated billing which yet remain major concerns on consumers instead of only addressing its low-revenue generation.

He, nonetheless, advised Eko Electricity Distribution Company against the belief that constant power supply would only be attained when the tariffa are increased.

“We all agree that efficiency will continue to be a problem; and so, the position we have taken so far is that what industries seek to do is to transfer the government subsidy to consumer subsidies.

“There are three main reasons that the DisCos, particularly Eko Electric had repeatedly articulated as some of the problems in the industry.

“One is that they are unable to remit the full revenue they are collecting on behalf of everybody in the industry; they are unable to remit it to NBET,” he said.

He itemised them as one, low tariff; two, energy theft; and three, metering.

“And it seems to me that the broad presentation that we have heard today addresses only one, which is a low tariff.

“If you are going to promote efficiency, the only way to promote it certainly cannot be by increasing tariffs,” Irukera noted.

To him, there is absolutely no question about the fact that increasing tariff will not in itself necessarily promote efficiency.

There is no moral justification for DisCos to embark on estimated billing, he affirmed.

He, therefore, called on NERC as the power industry regulator to institute a framework that would ensure that electricity consumers are protected in the whole process.

Report further indicates that some electricity consumers present at the hearing rejected the proposed tariff increase.

They expressed the opinion that efficient service delivery and improved power supply should be met first in view of the proposed tariff increase.

Earlier, Mr. Nosa Igbinedion, Head of Power Procurement Regulation, Eko DisCo, at the forum had requested an increase in electricity tariff from the current N28.28kwh to N42.41kwh.

Mr. Shitta Rogers, Chairman of the hearing panel and Commissioner at NERC, has said the team would look into all issues raised by Eko DisCo, and the consumers’ concerns for effective service delivery in the economy.

Meanwhile, NERC has barred the 11 DisCos from billing unmetered residential electricity consumers above N1,800 until they are metered.

In an Order 197 signed by Prof. James Momoh, Chairman, and Dafe Akpeneye, Commissioner, Legal, Licencing and Compliance, NERC, recently said the new order repeals the 2012 estimated billing regulation effective Thursday, February 20.

About 52 percent of 1o million electricity customers (as of December 2019) are not metered, but are placed on estimated billing by the DisCos.

NERC has also directed the DisCos to ensure that electricity consumers are metered by April 30, 2020.

It said the Meter Assets Provider (MAP) was initiated to increase the metering of consumers within three years.

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