Why Nigerians Pay High Tariffs

prepaid-meters

Power, Works and Housing Minister Babatunde Fashola has said the rise in electricity tariffs is due to the failure of the Nigerian Electricity Regulatory Commission (NERC) to review the tariffs periodically.

He said consumers would continue to pay high tariffs on power as long as relevant authorities refused to review them, adding that the issue has compounded the woes of consumers, who battle problems such as shortage of meters and poor supply of electricity, among others.

At an interactive forum organised for members of civil societies in Surulere, Lagos,  Fashola said consumers were not paying tariffs that reflected the cost of the electricity they are consuming.

The forum was at the instance of the Ministry.

 According to him, the NERC is expected to review tariffs paid by consumers, adding that the agency is not doing that.

Fashola said:‘’I have the understanding that the tariffs being implemented in the power sector are for a period of 10 years. The tariffs are expected to be reviewed during that period. If the tariffs have been reviewed, the prices, by now, must have come down. Rather than the prices of tariffs decreasing, they are increasing, due to the failure on the part of the regulators to review them as part of their oversight functions.”

He added: “I have no control over the amount that was charged as tarrifs in the sector. NERC is in charge of tarrifs. My duty as a Nigerian is to express my opinions on critical issues that are affecting the generality of the populace, and which I have done when NERC announced the increased in tariffs in 2016. I have expressed my opinions, and nobody can deny me the right not to do so.’’

He said inflation, interest and exchange rates were changing globally and the increase in those rates are not factored into the tariffs.

Fashola said power distribution companies (DisCos) advocated for increase in tariffs, and not the Federal Government.

‘’So, it is wrong for anybody to assume or belief that any minor or major increase in electricity tariffs is coming from the government. That the Federal Government is the one that proposes cost reflective tarrifs in the power sector is wrong. I disagree with that notion. It is the duty of NERC to approve electricity tariffs, once it certified that the tarrifs are okay enough for the consumers,’’he said.

Source: IWIN

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