On Friday, April 12, the Nigerian Electricity Regulatory Commission (NERC) provided pointers on the revised electricity tariffs for consumers. The update provided information on what actions consumers should take following the electricity tariff change.
This move comes amidst persistent issues of power generation, distribution inefficiencies, and financial viability in the country’s electricity industry.
What You Should Do
- Know Your Band
Visit your DisCo website to see if you are affected by this tariff change. You can check the revised list of Band A customers (reduced from over 1000 feeders to about 480) or use your account number to check your Band.
- Monitor Quality of Service
If you are a Band A customer, your DisCo must provide at least 20 hours of electricity daily. It is your right to receive that minimum hour of power daily. Monitor it. Please report it.
- Report
Report Quality of Service delivery to NERC so appropriate action can be instituted against the erring DisCo.
- Overcharging
If you are a Band B to E customer under the new tariff regime and are overcharged for electricity tokens, report it immediately. The government is still subsidising your electricity at the old rates.
Addressing customer complaints
- NERC has ordered all DisCos to refund all erroneous deductions from customers not in the revised Band A by April 12, 2024.
- The timeline for DisCos to resolve customer replacement of faulty prepaid meters and any other equipment fault takes two days.
- The timeline for DisCos to resolve customer complaints for power outages takes 3 to 5 days.
Note that the revised tariff structure aims to address several key concerns:
- Cost Reflectivity: One of the revised tariff’s primary objectives is to ensure that electricity tariffs accurately reflect the cost of generating and distributing power. This shift towards cost reflectivity is crucial for ensuring the financial sustainability of electricity providers, including attracting much-needed investment into the sector.
- Improve service delivery by implementing a tariff structure that better aligns with the cost of providing electricity. The hope is to incentivise electricity distribution companies (DisCos). This is to improve service delivery. Including reducing power outages, enhancing customer service, and investing in infrastructure upgrades.
- Revenue Generation: The power sector in Nigeria has long struggled with revenue shortfalls. Which has hindered investment in infrastructure and maintenance. The revised tariff structure will increase revenue generation for DisCos. Enabling them to meet their financial obligations, invest in modernising the grid, and improve overall operational efficiency.
- Consumer Welfare: The revised tariff may raise bills for some consumers, especially high users, but it aims to protect low-income households from undue burden. To this end, the tariff structure includes provisions for lifeline tariffs and targeted subsidies to protect vulnerable consumers.
The announcement of the revised electricity tariff has elicited mixed reactions from various stakeholders. While some consumer advocacy groups have expressed concerns about the potential impact on household budgets, others have welcomed the move as a necessary step towards addressing the power sector’s chronic problems.
Industry experts have emphasised the importance of accompanying the tariff revision with measures to improve transparency, accountability, and efficiency within the power sector. Additionally, they have urged substantial investment in renewable energy sources, including decentralised power generation, to diversify Nigeria’s energy mix and enhance energy security.
Implementing the revised electricity tariff represents a significant milestone in Nigeria’s ongoing efforts to reform its power sector. Despite challenges like ongoing investment needs and regulatory oversight, the revised tariff is a crucial step. This will improve a more sustainable and reliable electricity supply for all Nigerians.