Electricity tariff increase must be matched with improvement in metering

The tariff review is expected to move the industry towards a cost-reflective tariff thereby providing investors with the right incentives and increased confidence to commit capital. Expert argues that the most important thing is the sense of regulatory certainty which the Nigerian Electricity Regulatory Commission (NERC) that carries out its minor and major reviews when necessary, reports AMBROSE NNAJI.

Increase in electricity tariff must to be matched with improvement in services especially metering and ending estimated billing.

Former Chairman, Nigeria Electricity Regulatory Commission (NERC), Sam Amadi, who made this declaration advised the NERC to be realistic to balance between just and fair tariff adding that DisCos needed to recover their costs.

Amadi who spoke with the Nation Update on telephone stated that the most important thing is not the increase but the sense of regulatory certainty which a NERC that carries out its minor and major reviews when necessary.

It is true that the quality of service in the sedative is very poor and the operators especially discos have performed very badly. But the sector needs huge investment. Even as the public sector may support especially in provision of transmission services, the bulk of the funds are expected from the private sector, Amadi stressed.

Therefore, we have to be disciplined with regulatory such that tariff does not respond too much political considerations. “I think tariff should increase or decrease based on the Multi-Year Tariff Order (MYTO) framework”, he added.

The Multi-Year Tariff Order is a tariff model for incentive-based regulation that seeks to reward performance above certain benchmarks, reduces technical and non-technical/commercial losses and leads to cost recovery and improved performance standards from all industry operators in the Nigerian Electricity

Amadi again noted that affordability was important as underconsumption of grid energy because it is unaffordable will increase poverty and reduce economic growth. So, NERC has to make sure consumers are protected and that the increase is sustainable and affordable, he further advised.