The Nigerian Senate has called on the federal government to intervene in response to the proposed increase in electricity tariff by distribution companies, known as DISCOs.
Senators have urged the Nigerian Electricity Regulatory Commission (NERC) to decentralize the planned engagement with stakeholders, originally scheduled in Abuja, and hold it in the six geo-political zones of the country to ensure broader participation.
The Senate’s decision came after considering a motion titled “Need to Halt the Proposed Increase in Electricity Tariff by Eleven Successor DISCOs,” which was sponsored by Senator Yunus Akintunde and two others.
Senator Akintunde highlighted that the 11 successor DISCOs had applied for a rate review with NERC, citing the need to incorporate macro-economic parameters and factors affecting the quality of service, operations, and sustainability of the companies.
NERC had invited public comments on the rate review applications by the distribution licenses, setting a deadline for comments on July 20, 2023.
The Senator expressed concern that the proposed increase would negatively impact the affordability of electricity for the average Nigerian, exacerbating financial burdens faced by households and businesses.
He emphasized that it could hinder industrial growth, job creation, and economic development while impeding the nation’s progress toward sustainable development and poverty reduction.
Additionally, Senator Akintunde pointed out that the time frame of less than one week provided by NERC for stakeholders to submit comments was insufficient for meaningful engagement.
He emphasized the need to address issues related to inadequate power supply, metering, and the quality of service provided by DISCOs, ensuring customers do not bear the brunt of inefficiencies in the power sector.
As part of its resolutions, the Senate urged NERC to explore alternative measures to address the financial challenges faced by DISCOs, focusing on improving operational efficiency, reducing technical and commercial losses, and enhancing revenue collection mechanisms.
The Senate also called on DISCOs to discontinue estimated billing and provide prepaid meters to all electricity consumers at affordable prices.
Furthermore, the Senate mandated its Committee on Power, once constituted, to engage with the Federal Ministry of Power, NERC, and other stakeholders to find lasting solutions to the challenges in the electricity sector, including comprehensive reforms.
The Senate also emphasized that DISCOs should liquidate the cost of electricity transformers purchased by communities or individuals before adding them to the billing system.