Nigeria: New Electricity Tariff Suspension Extended By One Week

The Federal Government of Nigeria and the organised labour have resolved to extend the suspension of the new electricity tariffs by one more week.

This is to enable the review technical committee to work out modalities for the implementation of the agreement reached on the electricity tariffs structure, as well as address some grey areas of the report.

This was part of the decisions reached at the meeting between the Federal Government and organised labour at the Presidential Villa in Abuja, capital of Nigeria.

Speaking about the extension, Chairman of the Nigeria Electricity Regulatory Commission (NERC), Prof James Momoh said NERC was committed to ensuring that the power sector works no matter what it would take.

The Minister of State for Power, Prince Goddy Jedy-Agba said one million meters were already available and that distributions would start within the week.

Nigeria: NERC Calls For Abolition Of Electricity Tariff Subsidy

He disclosed that the distribution would be completed before December.

The resolution read by the Chairman of the Technical Committee and Minister of State for Labour and Employment, Festus Keyamo said: “The committee adopted a two-phase approach to proffer solutions that would help resolve issues affecting the sector in the medium term while providing relief to customers immediately.

“The immediate relief would be provided to citizens for a two to three-month period (not later than December 31, 2020), being the timeline for the conclusion of an extended scope of work for the Technical Committee.”

Some of the issues to address include a timeline for the distribution of the six million electricity meters being pledged by the government as part of the palliative deal.

In the report of the committee, the Federal Government accepted to procure six million meters to be distributed by the Discos to electricity consumers without metres.

It said: “Six million meters will only be through local meter manufacturers and assemblers and will be targeted at creating local jobs and a new meter manufacturing sub-sector in the country.”

The report also provided for salary protection for electricity workers.

It said that the government would ensure that the salaries for electricity workers were protected in the revised payment waterfall structure.

The report further stated: “Mandatory monthly publication by Nigeria Electricity Regulatory Commission (NERC) of allowed billings in Naira for unmetered customers to make the capping regulation more effective.

“NERC will publish maximum charges in Naira for consumers without meters (in support of the capping regulation); freezing of customer band migration during the interim period in order to protect customers from changes in tariff during the two to three-month period of review by the Joint Technical Committee.”

The report said that Discos would be directed to temporarily suspend customer band migration.

“This means that while Discos are expected to fulfill their Performance Improvement Plans (PIP), thereby, improving the quality of service to customers, no added charges will be passed on to customers during this period. This measure is aimed at building confidence in the Service-based Tariff structure.”

Other aspects of the technical committee’s report include the inclusion of labour representation in NERC, extensive review of key sector reforms, ground Audit of implementation across Discos, review of monitoring and evaluation mechanisms set up by NERC and the Discos.

Others are gas pricing, review mechanisms for pricing the domestic supply obligation (DSO) and the foreign exchange component(s), decentralisation of the grid.

The government is to explore ways to accelerate investment and bring more players into the sector, drive investment and reduce costs for end-users. Options should be in addition to the franchising and mini-grid regulations.

On the issue of import duty waivers for the electricity sector, the committee was mandated to investigate and recommend ways for the electricity sector to receive incentives that would reduce costs across the value chain that would impact on tariff.

Organised labour, led by the President of the Nigeria Labour Congress, (NLC), Ayuba Wabba, and Trade Union Congress (TUC), Quadri Olaleye, demanded an inclusion of timelines for the implementation of the report.

They insisted that there should be a timeline for the distribution of the six million meters promised by the Federal Government.

Mr Olaleye sought to know what the Federal Government would do with the N1.7 billion it said would be saved daily from the removal of subsidy on electricity tariff.