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Experts Justify Electricity Tariff Hike • MAN, NACCIMA Want New Tarrif Suspended

By on May 14, 2012

EXPERTS in the electricity industry have raised their voices in the support of the proposed increment in the electricity tariff, which is expected to come into effect on June 1, 2012. The increment, as proposed by the Nigerian Electricity Regulatory Commission (NERC), was designed to attract foreign investors to invest in the sector in accordance with the Multi-Year Tariff Order (MYTO).

Experts argued that the present tariff structure does not reflect what is being consumed by consumers hence the need for its upward review.

In a telephone chat with Saturday Tribune on Friday, the National Chairman of Nigerian Institute of Electrical Electronic Engineers (NIEEE), Engr Adekunle Makinde, opined that the NERC has done enough awareness with respect to this increment and their argument seemed to be bought by many stakeholders. He said this could be the reason it is not generating any controversies and the idea was being welcome by the National Economic Council (NEC).

According to him, “the reason adduced to the increment is to encourage foreign investors to come into sector and invest. This will in a way guarantee the returns on their investment because the present tariff structure does not reflect what is being actually consumed,” he said.

Another power solution expert, Engr. Dele Dada, said Nigerians were not really bothered by the pronouncement that there will be increase in tariff next month because many of us do not rely on PHCN electricity as source of energy. He argued that he would have loved a situation where there is improvement in power supply before the increment is effective.

Meanwhile, following the backing of state governors on the increase in electricity tariff under the Multi-Year Tariff Structure proposed by the Nigerian Energy Regulatory Commission (NERC) which is billed to commence on June 20, members of the Organised Private Sector (OPS), under the aegis of the Manufacturers Association of Nigeria (MAN) and the National Association of Chambers of Commerce Industry Mines and Agriculture (NACCIMA), have called on the Federal Government to suspend its planned hike in electricity tariff.

According to the Chairman, Apapa branch of MAN, Mr. John Aluya, the initiative by the Federal Government comes at a wrong time due to the infrastructural challenges currently beseiging the electricity sector.

Aluya lamented that at the moment, manufacturers are grappling with increased cost of production as a result of poor power supply, which has left many businesses in  the doldrums.