Editorial: Pending EEDC 78 Percent Tariff Increase, Which Way For South East Industries

The increment in electricity tariffs by the Federal Government which took effect from January 1, 2020, sent shockwaves among many Nigerians. This new development was seen as ill-advised, unhealthy and draconian among many.

This new order was published on the website of the Nigerian Electricity Regulatory Commission (NERC) titled, “December 2019 MYTO Minor Review Order for the 11 Discos”.

According to James A. Momoh, the Chairman of NERC, “This Order was taken into consideration the actual changes in the relevant macroeconomic variables and available generating capacity”. The commission cited inflation, exchange rate, the United States (US) rate of inflation, gas prices, generation cost, transmission and administration cost and other macroeconomic variables.

The energy charges for Enugu Electricity Distribution Company (EEDC) the DisCo that covers the entire Southeast was increased from N17.43/KWh to N30.93/KWh. R3 (Residential) and R4 (Residential) was increased from N27.11/KWh and N25.96 to N48.12/KWh and N46.08 respectively.

Every average entrepreneur in Nigeria knows the impact of the increase in electricity prices on the cost of doing business. The questions we are asking are, “Will the increase in electricity tariff lead to better access to electricity power supply” or “Did the increase in electricity came as a result of stable power supply”. If neither of these is correct it means Nigeria is paying more to access darkness, which means that the Federal Government wants to compound the misery of Nigerians.

The Speaker of the Federal House of Representatives, Femi Gbajabiamila has called for the suspension of the tariff hike. He said, “There is no guarantee that after any electricity tariff hike the Discos will not continue with the nefarious practice of bills estimation or provide uninterrupted power supply”.

More focus should be made on effective revenue collection, the ineffective revenue collection system by EEDC is part of the reason for the criminal estimated billing which has made some consumers paying for the electricity consumption of others. The EEDC should also work on their distribution capacity so many individuals, businesses, and communities in the Southeast should have access to light.

Doing business in Nigeria is already very challenging, making it less challenging should be the focus of the government. We suggest that the government should be more focused on developing policies and incentives that will create an enabling environment for businesses to thrive. The Southeast is in dire need of investments that will boost economic growth and development. We want the news making the headlines to be about how the Southeast can thrive in the new economy and be self-sufficient without depending on the dwindling revenue from the Federal Government. Whatever might be the justification for the new electricity hike, we urge the government to make life bearable for the average Nigerian.