THERE are strong indications that the proposed review of the electricity tariff will become effective on June 1 as planned despite strong opposition from labour unions.
The Trade Union Congress (TUC) had last week opposed the proposed review by insisting that power generation must improve before the new tariff can become effective.
The Federal Government has insisted that the new tariff will take effect as planned in order to make the sector very competitive. The Minister for Power, Professor Bart Nnaji, stated that the country needs to do things differently in order to get different results. He stated this at a town hall meeting in Lagos at the weekend.
According to Nnaji, “we are reviewing electricity tariff in accordance with the Electric Power Sector Reform (EPSR) Act 2005, which empowers NERC to review upward or downward as the case may be, to ensure that we have competitive tariff that will protect the interest of all stakeholders, both the consumers and the producers of power.
“The new tariff structure, effective June 1, will make the rural dwellers and the urban poor to pay lesser. They will be paying N4 per kilowatt as against N7 per kilowatt they are paying before. We are introducing cross subsidisation where the rich will be subsidising the poor, as being practised all over the world.”
A check by the Nigerian Tribune revealed that some Nigerians favoured the review of the tariff which, according to them, was not competitive at present, while others argued that the proposed review would have been embraced if it came at a time when power generation was improved.
According to a statement credited to Mr Sam Amadi, on the website of NERC: “when the first Multi Year Tariff Order (MYTO) prices were calculated in 2008, when MYTO was introduced, it was found that the cost-reflective tariffs were significantly higher than the non-cost-reflective tariffs that Nigerians had become used to.
The new tariff would cause what is known as price shock, which would have negative social and political consequences.”
A source within NERC, who preferred anonymity, told the Nigerian Tribune on Sunday that “March, April and May are not the ideal months to review the tariff, because of the drought season, in which water level is always low.
“At present, Shiroro hydro plant is shut down, due to lack of water supply, while Kainji power plant is producing below half capacity, due to drop in water supply.
“There is nothing anybody can do to this until July, when the wet season would have peaked. Reviewing the tariff is a necessity, but it is coming at a wrong time.”
Justifying the necessity of reviewing the electricity tariff, the source said “Nigerian tariff is not competitive; it is the cheapest in Africa and we all know that electricity is not cheap. Let’s us forget about the idea of getting everything cheap. If we want quality service, then we pay for it.
“Look at telecoms industry, competition has crashed the price when compared to what we used to pay when it came 10 years ago, but the service is improving day by day. If we don’t support the review, we will blame the minister of power for non-performance.”
However, the Manufacturers Association of Nigeria (MAN) has said it was in support of the review, considering how much it spent on power generation.
According to the chairman, electronics and electrical sectoral group, MAN, Mr Reginald Odia, “MAN spends N72.6 billion annually on diesel to power its generating sets, while N120 million is being paid monthly as electricity bill.”
He argued that if the increase in tariff would result in improved power supply, it would boost the country’s economy.”
The national vice-president, Nigerian Chambers of Commerce, Industries, Mines and Agriculture (NACCIMA), Alhaji Ahmad Rabi’u, said Nigerians would pay the new tariff if power supply was stable and sustainable.
“If we pay the proposed tariff, where will the money go? If you tell me where it will go, then I will encourage the hike and I will be encouraged to pay it,” he said.
June 1 date unacceptable —NLC
The Nigeria Labour Congress (NLC) has reaffirmed its opposition to moves by the Federal Government to increase energy tariff by June 1, saying at the weekend that the increase is unacceptable.
In a communiqué issued after its National Administrative Council (NAC) meeting in Abuja, the congress said it would not welcome any increase in tariff when it had not been established that electricity supply had improved considerably.
However, the NLC commended the decision of the presidency to prosecute those found culpable in the probe on oil subsidy regime in the country by the House of Representatives.
President of NLC, Abdulwaheed Omar, who signed the communiqué, said the congress had resolved to oppose the electricity tariff increase.
Omar said “it also resolved to oppose any increase in energy tariff without improved power supply, while it calls on all affiliate unions to continue the demand for the holistic restructuring of the downstream petroleum sector, through building of the new refineries and self sufficiency in products supply.”
The NLC president also said the congress remained steadfast in the struggle for total implementation of the new minimum wage in all the states of the federation and called on the affiliates to remain steadfast.
“The assurance by President Goodluck Jonathan that there will be no sacred cows in the investigation and prosecution of the corruption in the downstream sector of the oil industry is laudable and deserves commendation,” he said.
Comrade Omar said Nigerians are eagerly looking forward to a thorough and diligent prosecution by the Attorney-General and the security agencies in order to disabuse the minds of the watching public and to ensure that the process is not a hollow ritual.
News credit: Tribune
No comments:
Post a Comment