Nigeria’s Electricity Regulator Explains Recent Review Of Tariff

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The Nigerian Electricity Regulatory Commission (NERC) has explained that the recent review on electricity charge, which it made public last week is an adjustment of 2015 tariff.

OER had reported last week that beginning from next year, power consumers will have to pay an additional sum of between N8 and N14 for every kilowatt-hour of energy provided by their respective distribution companies (Discos).

In the review, NERC stated that the end-user allowed tariff from 2017 to 2019 per kWh was N32.66 in each of the years, while those of 2020 and 2021 were put at N42.46 and N44.21. For the Abuja Electricity Distribution Company (AEDC), for instance, the difference between what their customers pay currently and what they will pay from next year, going by NERC’s figures, is an increase of N9.8/kWh.

For the Benin Disco, the difference in payment between now and next year will be an increase of N9.75/kWh. For the Eko Disco, the difference will stand at N8.5/kWh. For Enugu Disco, customers will pay a difference of N10.6/kWh from next year. For residents who are served by Ibadan Disco, by next year, they will pay a difference of N9.1/kWh

Customers in the Ikeja Disco’s franchise areas, they will pay additional N8.2/kWh from next year, according to NERC.  In Jos Disco, the tariff increase for 2020 is N10.1/kWh, as consumers under this Disco will have to pay N43.9/kWh, as against N33.8/kWh, which they currently pay, while in Kaduna, power users will witness an increase of N9/kWh.

In Kano Disco, according to NERC, residents who are served by this Disco will witness an increase of N14.6/kWh in the tariff they pay for electricity. While the review raised anxiety among consumers nationwide, the Commission in a statement last weekend said the review is just an adjustment of the tariff regime released in 2015 to account for changes in macroeconomic indices for three years after.

“We wish to provide guidance that the minor review implemented by the Commission was a retrospective adjustment of the tariff regime released in 2015 to account for changes in macroeconomic indices for the years 2016, 2017 and 2018 thus providing certainty about revenue shortfall that may have arisen due to the differential between tariffs approved by the regulator and actual end-user tariffs,” the commission said.

It said the principal objectives of the review are clearly articulated in section 6 (a-f) of the Order. “The Commission, therefore, wish to notify the general public that no tariff increase has been approved by the Commission vide the Order.

“However, the Commission in the discharge of its statutory responsibilities enshrined under the EPSR Act, shall continue to undertake periodic reviews of electricity tariffs in accordance with the prevailing tariff methodology. In all instances of such reviews and rule-making, the Commission shall widely consult stakeholders and final decision shall take due regard of all contributions,” it said.


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