Revealed: How NERC Secretly Increased Electricity Tariff Without Informing Customers
It has been revealed last weekend that the Nigerian Electricity Regulatory Commission (NERC) secretly approved for six of the 11 electricity distribution companies (Discos) operating in Nigeria the approval to increase tariff rates, effective February 2022.
Investigations revealed that the tariff rise and collection of the new rates, under hidden circumstances by the Discos, has been on since three months ago without the knowledge of electricity consumers in the six networks.
NERC justified its action in a memo cited by newsmen last weekend, claiming that it was necessary considering increase in performance of improvement plans of the Discos.
The memo jointly signed by the NERC chairman, Sanusi Garba, and the vice chairman, Musiliu Oseni, was issued on December 29, 2021, while the increase took effect February.
The Discos affected include Port Harcourt Electricity Distribution Company (PHEDC), Kano Electricity Distribution Company (KEDC), Kaduna Electricity Distribution Company (KEDC), and the Jos Electricity Distribution Company (JEDC).
Others are, Ikeja Electricity Distribution Company (IKEDC) and Ibadan Electricity Distribution Company (IBEDC). NERC said while taking the action, it considered factors such as price of gas, inflation rate, exchange rate, and available generation capacity, before increasing the tariff.
According to the tariff increase, consumers who bought power at N50.72/kWh in January 2022 were to pay N54.22/kWh from February. Also those who bought at N56.16/kWh in January 2022 were to pay N60.67/kWh.
NERC stated that those who paid N56.64/kWh in January 2022 were made to pay N59.64/kWh.
“Consequently, following the approval of PHED’s PIP on 30th April 2021, the Commission issued the MYTO-2021 Extraordinary Tariff Order effective from 1st July 2021 in consideration on PHED’s CAPEX proposals over a 5-year plan in line with the approved PIP,” the document said.
“Accordingly, this MYTO-2022 order restates PHED’s approved 5-year CAPEX and relevant assumptions applied to forecast revenue requirements and applicable tariffs for the period 2021-2026 in line with MYTO Methodology and Regulations Procedure for Electricity Tariff Reviews in the Nigerian Electricity Supply Industry (NESI),” it said.