The Nigerian Electricity Regulatory Commission (NERC), yesterday said it will carry out a minor review of electricity tariff in Nigeria every six months to adjust to foreign exchange and inflation requirements.
NERC Chairman, Sanusi Garba, who disclosed this at a news conference in Abuja, insisted that there is nothing clandestine about the bi-annual review, as it may not necessarily result in increases.
He admitted that there was an adjustment in tariff in February following some economic fundamentals.
“What happened on February 1, 2022, was a minor review of tariffs. It is very clear on our website that every six months we will adjust rates to take care of the foreign exchange component of cost and also inflation,” Garba said.
Regarding the recurrent grid collapse and continuous power outages, Garba attributed the grid failure to a trip-off caused by the conductor snap, which started from the 330 Kilovolt Amperes (KVA) from the Benin axis and vandalism of pipelines that also supply gas to the power plants.
He noted that pipeline vandalism has been affecting gas supply to power plants, and a major reason for the worsening state of electricity supply in Nigeria.
What happened on February 1, 2022, was a minor review of tariffs. It is very clear on our website that every six months we will adjust rates to take care of the foreign exchange component of cost and also inflation.
The Chairman also confirmed the removal of electricity subsidy, saying: “The subsidies have been, at one time as high as N600billion a year, and gradually coming down to about N30billion or so this year.”
He warned that the electricity industry cannot be operated on a life support, adding that investors should be able to get their return on investment without the government stepping in to provide the required funding.
On gas supply, he said the AFAM VI gas plant in Port Harcourt, Rivers State, owned by Shell and the NNPC is being restored to improve power generation in Nigeria.
He said: “There is also another plant that has just been completed on the same site; we recently had a discussion on how that can also be brought on board to cover the shortfall in a generation.
“We had a meeting two days ago to see how NNPC and Shell can expedite the repair of the gas plant so that it can ramp up to cover generation.
“We also have the Niger Delta power plant and the Federal Government has invested in 10 new plants out of which eight are operational.
“Most of them are affected by gas shortages because they have not contracted officially for gas.”
He added that a lot of investments have been done in both generation and transmission to ensure steady power supply in the country.