Electricity Distribution Companies (DisCos) Stealthily Raise Tariffs without Public Announcement
There are indications that some Distribution Companies (DisCos) may have silently implemented a tariff change, in contrast to the stance of the Nigeria Electricity Regulatory Commission (NERC) that it has not sanctioned any electricity tariff increase.
A consumer in the service area of Ikeja Electric (IE) in Ojodu-Berger, Lagos State, reported experiencing a tariff increase despite NERC’s statement that no such approval had been granted to DisCos.
“I recharged my meter on Ikeja Electric yesterday (January 2) at 8:15 am with N5, 000 and after loading the token, I was surprised to be credited with 66 units of electricity; this is like 10 units short of what I got for the same amount on November 4, 2023, when I got 76 units for N5, 000. On November 21, 2023, I loaded N2,000 and got 29 units of electricity.
“Ikeja Electric has increased its tariff, except the firm wants to claim there is a fault in their system warranting this difference of 10 units,” a surprised Odeyingbo said, brandishing a copy of the payment receipt at The Nation.
When approached for comments, Kingsley Okotie, the Head of Media at Ikeja Electric, opted to question the reporter instead. He inquired whether it was a response to a specific story or if a complaint on behalf of a customer was being lodged.
Upon learning that it concerned Ikeja Electric’s reaction to a decrease in the number of electricity units purchased by a customer, without prior knowledge of a tariff increase, Okotie immediately adopted an aggressive stance, stating, “I am not someone that can be bamboozled. If it’s a complaint on behalf of a customer, they should contact our complaint center.
However, if it’s a reaction to your story, I cannot provide an answer.” Despite attempts to elicit his comments on the alleged increase, Okotie remained unresponsive. Electricity consumers, familiar with what they perceive as the “way of DisCos,” expressed no surprise at the situation.
In contrast, the Nigerian Electricity Regulatory Commission (NERC) insisted that there was no approval for a tariff increase.
In a statement on its website, NERC emphasized its responsibility to consider the economic conditions, power generation levels, and the challenges faced by both the power sector and the economy. Telephone calls to NERC’s General Manager, of Communications, Dr. Usman Arabi, went unanswered at the time of press.
It’s worth recalling that in November 2023, Minister of Power Adebayo Adelabu revealed that President Bola Tinubu had halted the implementation of an electricity tariff hike, emphasizing the need for subsidies on nationwide power consumption. In the third quarter of 2023, the federal government’s subsidy on electricity amounted to N204.59 billion, according to a NERC report.
“Tariffs should have been raised months back, but Mr. President said until we can achieve regular and incremental power supply we can’t touch the tariff. But for political reasons and empathy, you cannot cause an additional burden on Nigerians. We are talking about the exchange rate skyrocketing, galloping inflation and so many others that bring hardship to the people.
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“And Mr President is trying to relieve this hardship through various forms of palliatives. So it is not politically expedient and reasonable to now implement a tariff that is more like dumping the existing tariff.
We are now paying about N70 (per kilowatt-hour), and it can never be less than N130 or N140 at the exchange rate of today if we are to implement a cost-reflective tariff, because part of the reason for an increased tariff is the price of gas, which is paid in dollars,” Adelabu had explained back then.
