Earlier this Tuesday, the Nigerian Electricity Regulatory Commission (NERC) issued a statement debunking the purported 50% increase in electricity tariff.
Part of the statement reads thus:
The attention of the Commission has been drawn to publications in the print and electronic media misinforming electricity consumers that the Commission has approved a 50% increase in electricity tariffs.
2. The Commission hereby state unequivocally that NO approval has been granted for a 50% tariff increase in the Tariff Order for electricity distribution companies which took effect on January 1, 2021.
3. On the contrary, the tariff for customers on service bands D & E (customers being served less than an average of 12hrs of supply per day over a period of one month) remains frozen and subsidised in line with the policy direction of the FG.
4. In compliance with the provisions of the EPSR Act and the nation’s tariff methodology for biannual minor review, the rates for service bands A, B, C, D and E have been adjusted by NGN2.00 to NGN4.00 per kWhr to reflect the partial impact of inflation & movement in forex.
Well, here’s what we know, and understand about this development:
There was actually an increase, infact of as much as a hundred per cent but…
The fact as acknowledged by the electricity regulatory commission itself is that electricity tariff has been increased infact by as much as a hundred per cent but for a specific category of energy users, those the commission refers to as being on service bands A, B, C, D and E.
These categories of users covers all of the previous tariff classes itemized below
- Residential (R1, R2, R3, R4)
- Commercial (C1, C2, C3)
- Industrial (D1, D2, D3)
- Special (A1, A2, A3)
- Public Street Lighting (S)
These classes are now identified using a new classification table according to the number of hours of energy consumed
-
Service Bands New Tariff Classes Number of Hours of Supply Old Tariff Class Lifeline R1 R1 Band A A-Non-MDA-MD1 A-MD2
20 and 24 R2, C1, D1, A1 R3, C2, D2, A2, S1 R4, C3, D3, A3 Band B B-Non-MDB-MD1 B-MD2
16 to 20 R2, C1, D1, A1 R3, C2, D2, A2, S1 R4, C3, D3, A3 Band C C-Non-MDC-MD1 C-MD2
12 to 16 R2, C1, D1, A1 R3, C2, D2, A2, S1 R4, C3, D3, A3 Band D D-Non-MDD-MD1 D-MD2
8 to 12 R2, C1, D1, A1 R3, C2, D2, A2, S1 R4, C3, D3, A3 Band E E-Non-MDE-MD1 E-MD2
4 to 8 R2, C1, D1, A1 R3, C2, D2, A2, S1 R4, C3, D3, A3
As you can see, the A, B, C, D and E classes of energy users cut across the entire levels of energy consumers above. and it is same categories of energy users that have had their tariff hiked from N2.00 to NGN4.00 per kWhr to reflect the new realities in inflation and movement in forex. An increase of a hundred per cent!
Our thoughts:
This increase is in no way minor as claimed by the commission in its statement in which it countered news reports announcing the 50% increase in electricity tariffs.
A vital piece of information to note here is that when put into perspective, the service bands A,B,D and E actually houses as much as about 70% of energy consumers in the nation at the moment.
So question is, when an increment affects as much as 70% of total energy consumers, what exactly is that called?
