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Electricity tariff hike shows govt has lost touch with reality – Obonga

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The national secretary of the Network for Electricity Consumers Advocacy of Nigeria, NECAN and the lead director of Energy Consumers Consultancy Services, ECCS, Uket Obonga, said the hike in electricity tariff showed that President Bola Tinubu’s government has lost touch with reality.

Obonga disclosed this on Wednesday while reacting to the recent electricity tariff hike by the Nigerian Electricity Regulatory Commission, NERC.

DAILY POST recalls that NERC approved the hike in the price of electricity for Band A customers from N66 to N225 per kilowatt.

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The implication is that electricity customers within urban areas that have 20 hours of power supply will have to pay 300 per cent more despite a nationwide drop in electricity supply.

However, Obonga said the hike will not solve the liquidity crisis and other challenges within Nigeria’s power sector.

He stressed that the government lacks the creativity and capacity to address the country’s power sector challenges.

Obonga said the regulator should query the performance of the electricity distribution companies in meeting their obligations to customers. He urged that locally sourced gas should be priced in naira, not US dollars.

“The tariff hike for Band A customers to N225 per unit shows clearly that the guys at the commission (NERC) have lost touch with reality and lack the capacity to think creatively. A tariff increase will never solve the liquidity crisis.

“I have said it severally. It’s certainly not the silver bullet. Increasing the tariff to N1000 per kWh, will not solve the problem as long as the DISCOs remain rent seekers/collectors.

“What happened to the Performance Improvement Plan, PIP CAPEX, particularly Network CAPEX, that allocated over 50 per cent of the MYTO under the SBT regime? If today, the dollar goes up to N2,500, [will] we then ask for another hike? How long are you going to continue? To deal with gas pricing, it’s trite to denominate the gas prices in dollars. You source gas locally and process it for Gencos, who generate power and sell it in naira to the DISCOs, who in turn sell in naira. What is the foreign exchange component of processing a cubic foot of gas? The Federal Government should direct all the gas processors who source the major raw material (gas) to sell in naira at a fixed rate,” he stated.

Since January, electricity consumers nationwide have been suffering from epileptic power supplies.

The Minister of Power, Adebayo Adelabu, and the Transmission Company of Nigeria blamed gas constraints for the drop in power supply.

While Nigerians will have to grapple with the additional pain due to the hike in electricity tariffs, Adelabu said consumers will soon start singing good songs.


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