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Tag: Tariff

  • Electricity tariff: We only made minor adjustments – NERC clarifies

    Electricity tariff: We only made minor adjustments – NERC clarifies

    The Nigerian Electricity Regulatory Commission (NERC) has clarified that it did not hike electricity tariff by over 50 per cent.

    Rather, the NERC clarified that the rates for service bands A, B, C, D and E were only adjusted by NGN2.00 to NGN4.00 per kWhr.

    NERC in a statement released by its spokesman, Micheal Faloseyi explained that the adjustment is to reflect the partial impact of inflation and movement in forex.

    The electricity regulatory agency also stated that customers on service bands D and E were not affected by the adjustment.

    The NERC statement reads: “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.

    “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.

    “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.

    “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.

    “In the light of strong public interest on this matter, the media is hereby requested to retract their earlier publications misinforming electricity consumers nationwide about a purported 50% increase in electricity tariffs.

    “The Commission remains committed to protecting electricity consumers from failure to deliver on committed service levels under the service-based tariff regime.

    “Any customer that has been impacted by any rate increases beyond the above provision of the tariff Order should report to the Commission at customer.complaints@nerc.gov.ng.

  • BREAKING: FG again hikes electricity tariff by 50%

    BREAKING: FG again hikes electricity tariff by 50%

    The Nigerian Electricity Regulatory Commission (NERC) has approved an over 50% hike in electricity tariff effective January 1, 2021.

    This is contained in a revised Multi Year Tariff Order (MYTO) signed by the new Chairman of NERC, Engr. Sanusi Garba, on December 30, 2020.

    The new tariff hike regime is to be paid by customers of the 11 electricity Distribution Companies (DISCOs).

    This is coming just two months after the Commission forced implementation of much opposed hike on Nigerians in November 2020.

    According to the revised MYTO, the new tariff increase took effect on January 1, 2021, and supersedes the previous Order NERC/2028/2020.

    In the new Order NERC/225/2020, the commission said it considered certain factors to raise the tariff.

    The factors the commission said are 14.9% inflation rate rise in November 2020, foreign exchange of N379.4/$1 as of December 29, 2020, available generation capacity, US inflation rate of 1.22% and the Capital Expenditure (CAPEX) of the power firms.

    The revised Service Based Tariff (SBT) also saw an increase in the rates payable by all classes of electricity users unlike the one of November 2020, that exempted low power getters.

    This is effective till June 2021 while a Cost Reflective Tariff (CRT) expected to raise the new cost higher will be activated from June to December 2021, the NERC Order revealed.

  • AEDC effects revised service tariff Nov. 1

    The Abuja Electricity Distribution (AEDC) says it has effected the revised Service Tariff with effect from Nov. 1.

    AEDC General Manager, Corporate Communication, Mr Oyebode Fadipe said in a statement in Abuja on Sunday.

    “This is to inform our customers that with effect from Nov.1, AEDC has effected a revised Service Reflective Tariff as approved by the regulatory agency,” he said.

    Fadipe said that customers on the pre-paid platform will be the first to experience the revised tariff when they vend as from Sunday, Nov. 1.

    “While the revised tariff will reflect in the bills for customers on the postpaid platform when they receive their electricity bills.

    “The tariff is divided into five bands and based on hours of supply to the customers.

    “While customers on bands D and E have their tariff frozen, those on bands A, B and C will see some level of reduction in their tariff as they vend.

    “The AEDC assures its customers that it will, in line with the spirit and letter of the service reflective tariff, ensure that all customers receive quality service,” he said.

    He said that the AEDC was also committed to the improvement of service to customers in all its franchise area.

    “We, however, appeal to customers to please see this tariff regime as an opportunity for them to join hands with AEDC to speed up the process of improving the quality of service in the Nigerian power sector,” he said.

    Fadipe said that the table of the payment for the new tariff would soon be released.

  • NERC suspends electricity tariff hike for 2 weeks

    NERC suspends electricity tariff hike for 2 weeks

    The Nigerian Electricity Regulatory Commission(NERC) has ordered the 11 Electricity Distribution Companies (DISCOs) to suspend the Sept. 1 tariff increase for 14 days.

    The commission’s suspension order of the Multi Year Tariff Order (MYTO) 2020 signed by Prof James Momoh, NERC’s Chairman was released on its web site on Wednesday.

    NERC suspension followed a joint communique issued by the Federal Government and the labour unions.

    The Federal Government agreed that the recent review in electricity tariffs would be suspended by the commission for a period of 14 days to further consultations and finalisation of negotiations between the parties.

    The order by NERC said that from Sept 28 to Oct 11 the DisCos must revert all charges to the tariff existing as of Aug 31.

    “This means that for the next two weeks, electricity consumers having power above 12 hours who were affected by the over 100 per cent tariff hike would revert to their old charges.

    It said as empowered by Section 33 of the Electric Power Sector Reform Act, EPSRA 2005, the Minister of Power, Sale Mamman can issue such directive to NERC.

    The Secretary to the Government of the Federation, Boss Mustapha and Mamman were among the team that met with the labour unions.

  • NERC picks new date to implement increased electricity tariffs

    The Nigeria Electricity Regulatory Commission (NERC) has insisted on starting the implementation of the new electricity tariff increases on April 1.

    The NERC dropped the hint that the Power Sector Review Programme (PSRP) has proposed the elimination of tariff support in the electricity market by the end of 2021, except for the less-privileged customers who would continue to be supported under the Consumer Assistance Fund or any other intervention.

    It made this known in a document titled ‘Consultation paper on the proposed extra-ordinary tariff review of the MYTO -2015 Tariff Order for the Nigerian Electricity Supply Industry (NESI) in Abuja yesterday.

    It would be recalled that the National Assembly had prevailed on the commission to suspend the implementation of the new tariffs.

    According to the document, “with the gradual withdrawal of the FGN intervention on tariff support, it is planned that tariffs would gradually be increased to allow the utilities to, in line with the provisions of the EPSRA, recover their efficient cost of operation and a reasonable return on investment while freeing up the subsidy funds for government’s utilisation in other critical sectors of the economy.

    “However, the proposed rate increase would only be on the basis of a full understanding of the Performance Improvement Plans being proposed by the companies, with sanctions for failure to deliver on the said plans.

    “Noting that the core investors in DisCos are under contractual obligations to reduce the loss levels in the industry, it is expected that tariffs would eventually come down as a result of the efficiency gains and increased energy throughput.

    “In order to mitigate the impact of rate shock on consumers, it is proposed that the gradual increase shall commence on April 1, 2020.”

    The commission said that the entire market participants in the NESI recorded a total of N1.7trillion tariff-related between 2015 and 2019.

  • BREAKING: Reps panel orders NERC to suspend increment in electricity tariff

    The House of Representatives Committee on Power has asked the National Electricity Regulatory
    Commission (NERC) to suspend the recently announced increase in electricity tariff.

    NERC had directed the electricity distribution companies (DisCos) to enforce an upward review of the tariff starting from April 1.

    But Committee chairman, Aliyu Magaji, at its meeting, asked NERC to direct DisCos to suspend the review until further consultations.

    DETAILS Soon…

  • Court halts implementation of new electricity tariffs

    A Federal High Court sitting in Lagos has stalled the implementation of new electricity tariffs from April, pending the determination of a motion challenging it.

    The new tariffs, which go into force from April, were announced by the Nigeria Electricity Regulatory Commission (NERC) last week. NERC handed 11 Electricity Distribution Companies (Discos) the template for the new tariffs applicable in their regions..

    At the hearing of a suit by the Incorporated Trustees of Human Rights Foundation against 15 respondents in the electricity industry, Justice Muslim Hassan ordered the parties to maintain the status quo.

    The respondents are: NERC, the Bureau of Public Enterprises (BPE); the Nigeria Bulk Electricity Trading Company Plc; and the Minister of Power.

    Also joined as respondents are Abuja, Benin, Enugu, Ikeja, Kaduna, Kano, Port Harcourt, Yola, Eko, Ibadan and Jos DisCo.

    In its suit, the NGO filed an ex parte motion praying the court to stop the new tariff from coming into effect.

    The applicant contended that “the implementation of the purported minor review of the Multi-Year Tariff Order would create “unquantifiable hardship and damages” on electricity consumers.

    “Consumers will be made to pay very high tariff, which has been increased by over 40 per cent across the board of which is currently being billed.”

    In an affidavit deposed to by Theodora Ubabunike, the human rights group said: “It will amount to a great injustice to impose arbitrary electricity tariff on Nigerian electricity consumers.

    “Nigerians will suffer monumental loss as many people will not be able to access power or access same at very high tariff. I know that Nigerians are entitled to access public amenities like electrical power.”

    In arguing the application on Monday, the applicant’s counsel, Anaje Chinedu, prayed for “an order of interim injunction restraining NERC from taking any step towards the implementation of the purported Minor Review of the Multi-Year Tariff Order 2015 and the Remittance Order 2019,” pending the hearing and determination of the motion on notice .

    Justice Hassan declined to grant the ex parte application, but said “the status quo ante bellum shall be maintained by the parties in this suit pending the determination of the motion on notice.”

    He adjourned till January 20, 2020 for the hearing of the motion on notice.

  • NERC orders DisCos to increase tariff from Jan 1

    The Nigerian Electricity Regulatory Commission (NERC) has directed the 11 electricity distribution companies (DisCos) to increase their tariff effective from January 1, 2020.

    The NERC published the new tariffs for the different DisCos and categories of customers on its website via its order dated 31st December, 2019, which its chairman, Prof. James Momoh and Secretary Dafe Akpeneye issued in Abuja on Saturday.

    It was titled: “NERC in the matter of the December 2019 minor review Multi Year Tariff Order (MYTO) for Abuja Electricity Distribution Company Plc.”

    The commission said that this order supersedes “other orders issued on the subject matter, and shall take effect from 1st January 2020 and shall have effect on the issuance of a new Minor Review Order or an Extraordinary Tariff Review Order by the NERC.”

    It noted that the order has taken into consideration of the actual changes in relevant macroeconomic variables and available generation capacity as at October 2019 in updating the MYTO operating -2015 Tariff Order for 2019 in line with the provisions of the amended MYTO Methodology.

    It said that projections are made for the variables for Year 2020 and beyond based on the best available information .

    The commission however based adjustments in the tariff on the relevant data it obtained from the Central Bank of Nigeria (CBN) and National Bureau of Statistics (NBS) such as average monthly inflation rate of 11.3 per cent, exchange rate of N309.97.

    It also added that it obtained its data on inflation rate from the US rate of inflation , which projected 1.8 percent for the period of January to October 2019.

    Gas, which is one of the MYTO variables, according to the commission, its price has been $2.50/MMBTU and gas transportation $0.08/MMBTU.

    For the Abuja Electricity Distribution Company (AEDC) residential customers R3 that were paying N27.20 per unit are to now pay N47.09.

    The customers are now to pay N19.89 more per unit. It represents 236.75 per cent increase.

    The commercial customers C3 that paid N27.20 per unit in 2015 when the tariff was last adjusted and implement are now to pay N47.09 in 2020.

    For the Ikeja Electricity Distribution Company Customers, the R3 category paying N26.50 per unit is to now pay N36.92 per unit.

    The customers are now to pay additional N10.02 per unit.

    This is an indication of 368.49 per cent increase. The commercial customers C3 that paid N24.63 per unit in 2015 are to now pay N38.14 per unit.

    The customers are to pay additional N13.51 per unit representing 282.30 percent .

    For the industrial customers of the IKEDC D3 that paid N25.82 per unit are now to pay N35.85 per unit.

    The difference is now the additional 10.03 per unit, representing an increase of 357.42 percent.

    Enugu Electricity Distribution Company residential (R3) customers that were paying N27.11 per unit in 2015 are to now pay N48.12 per unit.

    The customers are to pay additional N21.01 per unit, which indicates 229.03 percent.

    The tariff however insisted that “All DisCos are obligated to settle their market invoices in full as adjusted and netted off by the applicable tariff shortfall.

    “in the determination for compliance to the minimum remittance threshold in this Order, the commission shall consider verified receivables from MDAs for the settlement period and DisCos’ historical collection efficiency for MDAs.

    “The commission shall hold the TCN responsible for deviation from the economic dispatch Order that adversely impact on the base weighed average cost of the wholesale of the energy”

    “All FGN intervention from the financing plan of the PSRP for funding tariff shortfall shall be applied through NBET and the MO to ensure 100 percent settlement of invoices issued by market participants.

    “Under this framework, the minimum market remittance by AEDC is determined after deducting the revenue deficient arising from tariff shortfall from the aggregate NBET and MO market invoices. AEDC shall be availed the opportunity to earn its revenue requirement only upon fully meeting the following obligations and subject to efficient operations.”

    According to the order, the Federal Government’s updated Power Sector Recovery Program envisaged an immediate increase in end -user tariffs until 1st April 2020 and a transition to full cost reflectivity by end of 2021.

    In the interim, said the commission, Federal Government, has committed to fund the revenue gap arising from the difference between cost reflective tariffs determined by the commission and the actual end-user tariffs payable by customers.

    The NERC explained 100 percent settlement of MO invoice based on the tariffs applied by the MO in determining respective invoices prior to this order.

    The commission said that effectively, this order places a freeze on the tariffs of TCN and administrative charges until April 2020 at the rates applied in generating MO invoices for the period of January -October 2019.

    NERC insisted that full settlement of 42 percent of NBET’s monthly invoices being the minimum remittance threshold prescribed in this order.

  • Court insists Multi Choice obeys order halting DSTV, GOTV tariff increase

    A Federal High Court in Abuja has insisted that its order halting the implementation of the recent price increases announced by digital satellite television services provider, MultiChoice Communications (DSTV) remains.

    Justice Nnamdi Dimgba made the clarification on Tuesday upon complaint by lawyer to the Federal Government, Babatunde Irukera that the company has declined to obey the order made ex-parte on August 20 this year.

    The judge said: “My order is in force. I believe it is in force until it is set aside. My order has to be obeyed. That is my position.”

    The Consumer Protection Council (CPC) sued, on behalf of the Federal Government, challenging the propriety of the latest price increases announced by MultiChoice for its services.

    Details later…

  • MTN, Glo, Airtel to increase data, call tariffs

    Nigerians may soon begin to pay higher tariffs on calls and data as the telecommunications companies in the country brace up for a new cyber security levy to be implemented by the Central Bank of Nigeria (CBN).

    This is coming on the heels of a directive from the CBN to all banks on the collection of 0.005 per cent levy on all electronic transactions into a National Cyber Security Fund.

    Section 44 of the Cybercrime Prohibition and Prevention Act 2015, which the CBN seeks to implement, states that “there shall be paid and credited into the Fund established under subsection (1) of this section and domiciled in the Central Bank of Nigeria: a levy of 0.005 per cent of all electronic transactions by the businesses specified in the second schedule to this Act.”

    Businesses affected by this charge include GSM service providers – MTN, Glo, Airtel, 9Mobile etc. and all telecommunication companies; Internet service providers; banks and other financial institutions; insurance companies and Nigerian Stock Exchange (NSE).

    However, speaking at a press conference in Lagos yesterday, the President of the Association of Telecommunications Companies of Nigeria (ATCON), Mr. Olusola Teniola, said the implementation of the levy is ill-timed, considering the fact that the telecom operators are currently battling with multiple taxation, which has risen from 26 in 2015 to 38 under the current administration.

    “At this point, if the CBN decides to go ahead with the implementation, we will have no choice but to pass the cost to the subscribers. Nigerians should be ready to pay more for calls and data subscriptions,” he said.

    Teniola added that with the additional burden, the operators might also consider downsizing their staff strength to stay afloat.

    ATCON, which is a professional, non-profit, non-political umbrella organization of telecommunications companies of Nigeria, said all its members have concluded that the only way to survive with the new levy is to increase tariff across board. “The eventual implementation of this levy of 0.005 per cent would cripple, if not render useless government and private sector efforts to speed up the broadband penetration in Nigeria and our association has a mandate to protect the investment in the telecom industry from undue pressure from the government in the form of yet additional burden on our members that are already overtaxed by all tiers of governments,” the ATCON President added.