New Tariff order to take off in July – Minister of Power

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By Ikenna Omeje

 

The Minister of Power, Engr. Saleh Mamman, has said that the new tariff order proposed by the Federal Government will kick off in July, 2020.

Nigerian Electricity Regulatory Commission (NERC), had in January announced that there would be an upward review of electricity tariff across the country from April 1.

The new tariff order was postponed in March owing to a number of reasons which include the impact of COVID-19 pandemic and the number of unmetered electricity customers in the country which currently stands at above 60, percent.

However, Mamman while speaking on Tuesday at the investigative public hearing on Power sector recovery plan and the impact on COVID-19 pandemic, said the subsidy which was incurred in order to maintain the current tariff level is unsustainable.

“The impact of the COVID-19 pandemic has also affected our laid-out plan for the repositioning of the electricity market towards financial sustainability under the Power Sector Recovery Programme (PSRP),” the Minister said.

“Initially, the regulator, following the completion of public consultation on tariff review, planned on conducting a tariff review in April 2020.

“However, due to COVID-19 and customer apathy, the proposed tariff review was delayed by three months.

“The impact of this means the subsidy being incurred in maintaining the current tariff level had to be maintained until July 2020 when the proposed tariff review will be implemented.

“The current situation in the Nigerian power sector is that a lot of capital investment is being made, most of which is dependent on donor funding, loans and budgetary allocation.

“For projects that we have already secured their funding, we do not expect any adverse effect.”

The Association of Nigeria Electricity Distributors (ANED) and other stakeholders have been advocating for the democratisation of the power sector to allow for the forces of demand and supply to determine electricity tariff. According to them, this will end the current subsidy regime and ensure sustainability of the sector.

Despite their privatisation in 2013, the Federal Government has disbursed the sum of N1.8 trillion to power Distribution Companies (DisCos) as intervention fund, which the President of Senate, Ahmed Lawan, on Monday described as a misapplication of fund.

 

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