Govt to increase electricity tariff every year 4 years ago 1

Nigerians who are complaining about the scheduled June 1 increase in electricity tariff are in for a shocker. This is because the anticipated increment is only the first in a series as the tariff will be raised every year throughout the administration of President Goodluck Jonathan and even beyond.

The Multi-Year-Tariff Order prepared by the Nigerian Electricity Regulatory Commission, which was obtained exclusively by our correspondent in Abuja on Monday, showed that there would be increases in electricity tariff every year till 2016.

The tariff schedule showed that consumers would have to pay higher on two fronts. Every year, the fixed cost will go up. Similarly, the energy cost or cost per kilowatt hour of electricity will also go up.

NERC had consistently said that increase in electricity tariff would be for the short run and that the amount payable by customers would begin to fall when the country had produced enough electricity.

However, the tariff structure produced by NERC showed that the short run would be longer than four years as tariffs would continue to increase until at least 2016.

Responding to a text message by our correspondent, the Executive Chairman, NERC, Dr. Sam Amadi, said he could not predict the time frame when the tariff would begin to take a downward curve.

“I don’t know. It depends on the quantity of power available and the rate at which losses are reduced and efficiency improved,” he said.

Consumers in different parts of the country will also pay different charges depending on the rating of the distribution zone where they reside.

It is only very poor urban and rural dwellers that will pay the same rate throughout the country under the new dispensation. These categories of consumers will not pay any fixed cost and their tariff of N4/kWh will not vary for the next five years.

However, R2 customers, the category that majority of electricity consumers belong, will have to pay more for the fixed and energy charges.

For R2 customers in Abuja, the fixed charge has been raised from N75 per month to N500 for 2012. In 2013, this charge will be raised to N702 per month, going up to N986 in 2014; N1,384 in 2015 and N1,944 per month in 2016.

This category of consumers is expected to pay N11.28/kWh of electricity per month beginning from June 1. This will increase to N12.13 in 2013; N12.74 in 2014; N13.37 in 2015 and N14.04 in 2016.

For R3 consumers in Abuja, the fixed cost has been raised from N300 per month to N37,527 beginning from June 1, 2012. This cost will go up to N52,696 per month in 2013; N73,997 per month in 2014; N103,908 and N145,909 in 2015 and 2016 respectively.

These customers will have to pay an energy cost of N22.62/kWh from June 1; N22.62 in 2013; N23.75; N24.94 and N26.19 in 2014, 2015 and 2016, respectively.

R2 customers with the Eko Distribution Zone will pay N500 as fixed cost from June 1, up from the previous N75 per month. In 2013, this cost will go up to N750 per month and N1,125 per month in 2014. It will similarly go up to N1,688 in 2015 and 2016.

This category of customers will pay N13.03/kWh from June 1, 2012, but the rate will subsist till 2016.

R3 customers under the Eko Distribution Zone will pay N18,764 per month as fixed cost beginning from June 1,up from N300; and N28,145 in 2013. The cost will go up to N42,218, N46,440 and N51,084 in 2014, 2015 and 2016, respectively.

The energy cost for R3 customers in the zone will be N23.40/kWh from June 1 and the rate will remain in place till 2016.

In the Ikeja Distribution Zone, R2 customers will begin to pay N500 as fixed cost from June 1, up from N75 per month previously. In 2013, the cost will go up to N750 per month and N895 per month in 2014. It will rise to N1,067 and N1,273 per month in 2015 and 2016, respectively.

For this category of consumers, the energy cost will vary from N12.84/kWh in 2012 to N12.51/kWh in 2013; N12, 89/kWh in 2014; N13.27/kWh in 2015 and N13.67/kWh in 2016.

R3 customers in the Ikeja zone will pay N17,513 per month as fixed cost beginning from Friday, up from N300 previously; but the cost will rise to N26,269 every month in 2013; and N31,332, N37,371 and N44,575 in 2014, 2015 and 2016, respectively.

Customers in this category will have to pay an energy cost of N21.84/kWh from June 1; N22.50/kWh in 2013; N23.17/kWh in 2014; N23.87/kWh in 2015; and N24.58 in 2016.

Attempts to get the Minister of Power, Prof. Bart Nnaji, to speak on the matter failed, but he had at a recent public forum said it was necessary for the rich to pay more for electricity.

He had said the new tariff would not only increase the capacity of the government to improve electricity, but also increase the entire value chain in the electricity industry, including metering. Home Page

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