Some Electricity Distribution Companies (DisCos) are writing to inform customers that tariff will go up from July 1, 2020 following approval from the regulator and the Nigerian Government.
“Following the directive of the Nigerian Electrical Regulatory Commission (NERC), with the approval of the Federal Government, on the planned electricity tariff review which will take effect on July 1, 2020, the Enugu Electricity Distribution Company (EEDC) wishes to notify her esteemed customers of this development,” said a notice from EEDC.
“The Nigerian Electricity Regulatory Commission (NERC) last year approved an average of 30 percent increase in electricity price bands exempting customers who with very limited consumption.
Inquries show that other DisCos are preparing to release similar notices to their customers.
EEDC said the tariff review is necessary since the government cannot fund its subsidy any longer.
“The new tariff is service reflective, so customer that enjoy premium services are expected to pay higher tariff based on the guaranteed hours of availability and service quality,”
“However, there will be no tariff increase for those customers that have low level of supply and lower service quality. This is consistent with the feedback received from customers during the stakeholders consultations for extraordinary tariff review application organised by EEDC and NERC respectively in February and March this year,” EEDC said.
The Federal Government has that to protect consumers and improve accountability, it is instituting a Service Reflective Tariff that is coming into effect on July 1st that prevents consumers from having Tariff increases by the DISCOs without a commiserate improvement in service quality and supply.
The funds from the World Bank will allow for continued subsidy for the poor, moving away from the current situation where 60% of the subsidy is enjoyed by the top 20% of the population at the expense of the poor. It is expected that the top 20% will pay more in this new approach, the governmetn said.
The Federal Government nonetheless is still planning on spending N380 billion this year on tariff subsidy mainly targeted at the poor.