NERC denies approving electricity tariff increase for DISCOs

The Chairman, Nigerian Electricity Regulatory Commission (NERC), Dr Sam Amadi, said the commission had not approved any increase in electricity tariff or charges by electricity Distribution Companies (DISCOs). Amadi made the disclosure at a media briefing on the alleged plan to increase the tariffs in Abuja on Wednesday.
“We want to make it clear that NERC has not approved any increase by any DISCO.
“However, customers who feel that they are victims of such purported increases should come forward with evidence,’’ he said. Amadi said the commission had put in place a team to go out to the field and investigate such complaints. He said the new owners of the DISCOs could not unilaterally increase the tariffs without the express approval of NERC.
“Companies who want to charge more for their services must apply for a rate review.
“Once this application is received by the commission, a thorough and transparent process of stakeholders engagement follows before any rate review becomes official,’’ Amadi said.
He, however, explained that the different DISCOSs had different tariff rates approved for them based on their location and operational cost profiles. Amadi recalled that the commission recently met with the new owners of the DISCOS and Generating Companies (GENCOs). He said the meeting was with a view to improving service delivery and addressing issues such as shortfall in gas supply, billing system and load allocation.
Amadi attributed the current drop in electricity generation to the shortfall in gas supply, and noted that about 2,859 megawatts was unutilised capacity due to gas shortage as at Dec. 3. On the non-adherence to the Multi Year Tariff Order (MYTO) by some DISCOS, he said NERC was already working with all stakeholders involved.
Amadi said this was with a view to ensure the tariff order was adhered to and the operational concerns of the DISCOs addressed.
The MYTO plan stipulates a tariff plan that sets both wholesale and retail tariffs for the industry over a five-year period until it is reviewed by NERC. There are reports that some of the DISCOs have already jerked up the monthly service charge from N750 to N1, 500 due to what they term operational loss. One of the primary functions of NERC as enshrined in the Electric Power Sector Reform (EPSR) Act, 2005 is to ensure that prices charged by licensees are fair to consumers. NERC is also to allow the licensees reasonable earnings for efficient operations.