The Senate has called on the Federal Government to, as a matter of urgency, put an end to any plans to increase electricity tariffs in the country, just as the Senators argued that an attempt by the federal government to raise tariffs and removal of subsidy is ill-timed.
It said that the government, rather than increasing electricity tariffs, should focus on electricity generation and distribution.
The Senate has resolved to investigate the over N2 trillion that the Minister of Power, Bayo Adelabu, said was required for the electricity tariff to avoid a repeat of the fuel subsidy scandal.
Recall that Adelabu, while briefing journalists last week, stated that Nigeria cannot continue to subsidise electricity due to massive indebtedness in the power sector totalling N3 trillion, although only N450 billion was budgeted for subsidy in 2024, while the ministry requires more than N2 trillion.
The Senate has mandated its Senator Enyinnaya Abaribe, APGA, Abia South-led Committee on Power to investigate the over 2 trillion-naira subsidy requirements as stated by the Minister of Power to avoid the repeat of the fuel subsidy scenario and the statement made by the Hon. Minister with regards to the 1.3 trillion naira the ministry was owing generating companies and 1.3 billion dollars owed to gas companies.
The Committee has been mandated to investigate the operations of DISCOs to ascertain the current status of metering and their extent of compliance with relevant legal and regulatory frameworks in service delivery, as well as to direct the NERC to furnish the Committee with any relevant documents on metering of electricity consumers, post-privatization requirements for the operation of DISCOs, and evidence of regulatory actions taken to ensure statutory compliance by DISCOs.
The Upper Chamber has also urged the Committee to investigate the roles of the Ministry of Power, NERC, and Ziglaks Company in the failed agreement to provide prepaid meters and ensure Nigeria is not shortchanged.
The Committee has also been mandated to engage the Nigerian Electricity Regulatory Commission (NERC) to come up with a lasting solution to the energy billing system in the country and other related issues therein.
Resolutions of the Senate on Wednesday were a sequel to a motion titled, “Planned Increase in Electricity Tariff and Arbitrary Billing of Unmetered Customers by Distribution Companies (DISCOS), sponsored by Aminu Iya Abbas, PDP, Adamawa Central, and co-sponsored by 10 others.
The Senate has also asked its Committee on Power to find out the truth of the matter with regards to the issue of the Federal Government directive and release of funds for mass pre-paid metering, report findings to the senate, and enforce and ensure the judicious utilisation of the 10.5 billion naira penalty imposed on DISCOs.
The Upper House has asked the Committee to direct NERC to ensure the implementation of energy caps by all DISCOS for unmetered customers in the country.
The committee was directed to submit a comprehensive report for further legislative action within three weeks.
Presenting the motion, Senator Aminu Iya Abbas said that the Senate “notes with greatest dismay the plan to increase the electricity tariff by the relevant statutory authority in gross disregard of increased economic challenges with attendant widespread poverty and high cost of living;
“The senate may note that the Hon. Minister of Power was reported saying “the nation must begin to move towards a cost-effective tariff model, as the country is currently indebted to the tune of 1.3 trillion naira to generating companies (GenCos) and 1.3 billion dollars owed gas companies. According to him, of the N2 trillion needed for subsidy, only N450 billion was budgeted this year.”
“The Senate may further note that the same electricity businesses are collecting money from customers for services not rendered. When they have not added anything to the equipment, they inherit it from PHCN. Communities buy transformers to replace damaged ones, in addition to overburdening bills and arbitrary estimates for unmetered customers;
“Cognisance in a country where greater number of the population live below the poverty level, with stagnant wages, rising inflation, and depreciating currency, the prospect of higher electricity bill is unattainable.”
According to him, the Senate “notes that the issue of arbitrary energy charges on unmetered customers has become worrisome given the February 2024 report of the Nigerian Electricity Regulatory Commission (NERC) on the non-compliance with energy billing caps by DISCOS and the penalty of ₦10.5 billion imposed on the distribution companies that over-billed its unmetered customers;
“Aware in 2018, the then Hon. Minister of Power, Works, and Housing directed the Nigerian Electricity Regulatory Commission (NERC) to issue a regulation that facilitates the signing of meter agreements between the Federal Ministry of Power, Works, and Housing, Ziglaks Company, and other meter asset providers to address the metering gaps in the power supply industry;
“Further aware that, as far back as 2020, the president then, ordered the Nigerian Electricity Regulatory Commission (NERC) to commence mass pre-paid metering to end estimated billing and that funds were released to that effect;
“Disturbed that the multiple sanctions declared to be imposed by NERC against DISCOs for failing to comply with the scrapping of estimated bills for unmetered customers, which include credit adjustments to overbilled unmetered customers for the period January – September, 2023 by the March 2024 billing cycle, publication of the list of credit adjustment beneficiaries in two national dailies, and deduction of N10,505,286,072 from the annual allowed revenues of the eleven DISCOs during the next tariff review seemed to have been in futility given the continued violations by DISCOs;
“Recall that this Senate, via a motion, called on the Federal Government and NERC not to increase tariffs on electricity for customers and citizens of this country at this time;
Regret that in addition to the high cost of living being experienced in the country, the unmetered customers who are owners of small and medium enterprises are adversely impacted by this level of exorbitant electricity charges and, by implication, have their businesses affected. While the prospect of the new Electricity Act, 2023, ensuring accurate electricity charges will be negated if DISCOs are not investigated to ascertain the current statistical data on unmetered customers, poor provision of electricity service despite exorbitant tariffs, and the regulatory role of NERC, which leaves much to be desired.”
In his contribution, Senator Aminu Tambuwal, PDP, Sokoto South, while cautioning the Federal Government, asked it to jettison the idea, especially at a time when citizens are still grappling with the economic hardship brought on them by the removal of fuel subsidy.
Also contributing to the motion, the Senate Minority Leader, Senator Abba Moro, PDP, Benue South, said that Nigeria must first be sufficient in the generation and distribution of power before considering an increase in tariff.
On his part, Senator Orji Kalu, APC, Abia North, noted that even advanced economies subsidise electricity. He said the focus of government should be on distribution. “Why should people be paying for what they did not use. Our focus should be on transmission and distribution,” he said.
In a remark, the President of the Senate, Godswill Akpabio, who agreed with his colleagues, noted that any increase will further throw Nigerians into untold hardship, especially now that they are grappling with hunger and high cost of living.
