Tag: electricity tariff hike

  • SERAP Sue Buhari Over Unlawful Electricity Tariff Hike

    SERAP Sue Buhari Over Unlawful Electricity Tariff Hike

    The Socio-Economic Rights and Accountability Project (SERAP) has filed a lawsuit against President Muhammadu Buhari over “the failure to reverse the unlawful, unjust, and unreasonable increase in electricity tariff, and to probe the spending of public funds as ‘investments and bailouts’ to DisCos and GenCos since 2005.”

    Joined in the suit as Respondents are the country’s Attorney General and Minister of Justice, Abubakar Malami, the Nigerian Electricity Regulatory Commission (NERC), and the Nigeria Bulk Electricity Trading PLC.

    The group’s action comes after NERC approval to Electricity Distribution Companies to increase tariffs.

    The case, with suit number FHC/L/CS/99/2023 was filed last Friday at the Federal High Court, Lagos.

    SERAP told the court to “compel President Buhari to direct the Attorney General of the Federation and Minister of Justice Mr Abubakar Malami, and appropriate anti-corruption agencies to promptly investigate the spending of public funds as investments and bailouts to DisCos and GenCos since 2005.”

    Nigerians have witnessed incessant electricity tariff hike since Buhari’s government resumed office in 2015 without an improved power supply.

  • NERC Confirms Electricity Tariff Hike Across 10 DisCos

    NERC Confirms Electricity Tariff Hike Across 10 DisCos

    The Nigerian Electricity Regulatory Commission (NERC) yesterday confirmed adjustments to electricity tariff regime across ten electricity distribution companies with increases ranging from 5-12 percent.

    The adjustment to the Multi-Year Tariff Order (MYTO) took effect from February 1, 2022, according the regulations issued by the Commission and posted on its official website on Wednesday night.

    Justifying the rise in tariff, NERC stated that it was to “ensure that tariffs payable by consumers are commensurate with and aligned with the quality and availability of power supply committed to customer clusters” by the DisCos.

    It also added that the adjustment would ensure that prices charged by the DisCos “are fair to customers” and are sufficient to allow the DisCos “to follow recover the efficient cost of operation including a reasonable return on the capital invested in the business”.

    NERC also stated that the adjustment would also “ensure sustained improvement in reliability of supply in line with the DisCos capital expenditure (CAPEX) proposals and performance in improvement plan”.

    Checks by Vanguard on the Order for individual DisCos showed that for Abuja DisCo, non-maximum demand (Non-MD) customers in Band A (minimum of 20 hours supply per day) would be billed 8 percent higher while maximum demand (MD) customers in the same band would be charged 1.04 percent lower.

    For Non-MD in Band B (minimum of 16hrs per day), tariff rose by 8.8 percent while it remained the same for MD customers in Band B. For Non-MD customers in Band C (minimum of 12hrs per day), tariff rose by 11 percent while MD customers would pay 7 percent more.

    Also, for Non-MD customers in Band D (minimum of 8hrs per day), tariff rose by 11.7 percent while those on MD would pay 6.8 percent more. For Non-MD customers in Band E (minimum of 4hrs per day), tariff rose by 12 percent while MD customers in the band would have a reduced tariff of 5.3 percent.

    For the poorest consumers (Lifeline: R1) with energy consumption of not more than 50kWh per month, tariff remained frozen at N4.

    With the adjustment, NERC has ordered the DisCos to pay 100 percent of invoices issued to them by the Nigerian Bulk Electricity Trading Plc (NBET) and the Market Operator (MO).

    The Commission warned that DisCos shall “be liable to relevant penalties/sanctions for failure to meet the minimum remittance requirement in any payment circle under the terms of respective contracts with NBET, MO and the provisions of the Market Rules and Supplementary TEM (Transition Electricity Market) Order”.

    The Yola Electricity Distribution Company which was recently sold to a new owners was not captured in the adjustment.

  • NLC, TUC suspends planned strike as FG reverses electricity tariff hike

    NLC, TUC suspends planned strike as FG reverses electricity tariff hike

    The Nigeria Labour Congress and the Trade Union Congress have suspended the strike scheduled to commence today (Monday).

    This followed an agreement reached with the Federal Government at a meeting which started at 8.30pm on Sunday and ended at 2:50am this morning.

    After exhaustive deliberations on the issues raised by the labour centres, the meeting agreed to suspend the application of the cost-reflective electricity tariff adjustments for two weeks.

    The Minister of Labour and Employment, Chris Ngige, read the five-page communique signed by the representatives of the government and labour.

    The NLC President, Ayuba Wabba; and his Trade Union Congress counterpart, Quadri Olaleye, amongst others signed on behalf of Organised Labour while the Minister of Labour, Chris Ngige; Minister of State Petroleum, Timipre Silva; Minister of State Labour and Employment, Festus Keyamo (SAN); Minister of Information, Lai Mohammed; and the Secretary to Government of the Federation, Boss Mustapha and others, signed on behalf of the government.

    He said, “Definitely correct. We just left a press conference. We signed a document to suspend the action for two weeks for the government to implement those things that we agreed in the agreement. So, we are suspending for two weeks.

    “We don’t need a notice again to re-convene if there is a need to do that.”

    The parties agreed to set up a technical committee comprising Ministries, Departments, Agencies, NLC and TUC.

    It would work for a duration of two weeks effective September 28, to examine the justifications for the new policy “in view of the need for the validation of the basis for the new cost-reflective tariff as a result of the conflicting information from the fields which appeared different from the data presented to justify the new policy by NERC; metering deployment, challenges, timeline for massive rollout.”

    The members of the committee include the Minister of State Labour and Employment, Festus Keyamo (SAN) as Chairman; Minister of State Power, Godwin Jedy-Agba; Chairman, National Electricity Regulatory Commission, James Momoh; Special Assistant to the President on Infrastructure, Ahmad Zakari as the Secretary.

    Other members are Onoho’Omhen Ebhohimhen, Joe Ajaero (NLC), Chris Okonkwo (TUC) and a representative of electricity distribution companies.

    The committee’s terms of reference are to examine the justification for the new policy on cost-reflective electricity tariff adjustments; to look at the different DISCOs and their different electricity tariff vis-à-vis NERC order and mandate; examine and advise government on the issues that have hindered the deployment of the 6 million meters, among others.

    “During the two weeks, the DISCOs shall suspend the application of the cost-reflective electricity tariff adjustments,” the communique noted.

    It also noted that the FG has fashioned out palliatives that would ameliorate the sufferings that Nigerian workers may experience as a result of the hike in cost electricity tariffs and the deregulation of the downstream sector of the petroleum industry.

    The palliatives will be in the areas of transport, power, housing, agriculture and humanitarian support.

    The meeting also resolved that the 40 per cent stake of government in the DISCO and the stake of workers should be reflected in the composition of the DISCO’s boards.

    It agreed that “an all-inclusive and independent review of the power sector operations as provided in the privatization MoU to be undertaken before the end of the year 2020, with labour represented.

    “All parties agreed on the urgency for increasing the local refining capacity of the nation to reduce the overdependency on importation of petroleum products to ensure energy security, reduce cost of finished products, increase employment and business opportunities for Nigerians.”

    To address this, the parties resolved that the Nigerian National Petroleum Corporation should expedite the rehabilitation of the nation’s four refineries located in Port Harcourt, Warri and Kaduna to achieve 50 per cent completion by December 2021, while timelines and delivery for Warri and Kaduna will be established by the inclusive steering committee.

    “To ensure commitment and transparency to the processes and timelines of the rehabilitation exercise, the management of NNPC has offered to integrate the national leadership of the Nigeria Union of Petroleum and Natural Gas Workers and Petroleum and Natural Gas Senior Staff Association into the steering committee already established by the corporation,” the communique stated.

    It added that a validation team comprising the representatives of the NNPC, Nigeria Extractive Industries Transparency Initiative, Infrastructure Concession Regulatory Commission, NUPENG and PENGASSAN would be established to monitor progress of the rehabilitation of the refineries and the pipelines/strategic depots network and advice the steering committee periodically.

    It also said that post-rehabilitation, NNPC shall involve the PENGASSAN and NUPENG in the process of establishing the operational model of the nation’s refineries.

    The statement added, “The Federal Government will facilitate the delivery of licensed modular and regular refineries, involvement of upstream companies in petroleum refining and establishing framework for financing in the downstream sector.

    “NNPC to expedite work on the Build, Operate and Transfer framework for the nation’s pipelines and strategic depots network for efficient transportation and distribution of petroleum products to match the delivery timelines of the refineries as agreed.”

    The government and its agencies agreed to ensure delivery of 1 million CNG/LPG AutoGas conversion kits, storage skids and dispensing units under the Nigeria Gas Expansion Programme by December 2021 to enable delivery of cheaper transportation and power fuel.

    A governance structure that will include representatives of organized labour shall be established for timely delivery.

    To cushion the impacts of the downstream sector deregulation and tariffs adjustment in the power sector, the FG agreed to announce in two weeks a specific amount to be accessed by workers with subsequent provision for 240,000 workers under the auspices of NLC and TUC for participation in agricultural ventures through the Central Bank and the Ministry of Agriculture.

    The timeline will be fixed at the next meeting.

    The meeting further resolved that the FG will facilitate the removal of tax on minimum wage as a way of cushioning the impacts of the policy on the lowest vulnerable.

    The government would also make available to organized labour 133 CNG/LPG-driven mass transit buses immediately and provide to the major cities across the country on a scale up basis thereafter, to all states and local governments before December 2021.

    “On Housing, 10 per cent to be allocated to Nigerian workers under the ongoing Ministry of Housing and Finance initiative through the NLC and TUC,” the communique disclosed.

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