Minister of Power, Prof. Bart Nnaji
From Kunle Akogun and Chineme Okafor in Abuja
Minister of Power, Prof. Bart Nnaji, Tuesday said electricity tariff in the country would not go up by 88 per cent.
Nnaji was recently quoted in the media to have said that electricity tariff in the country would increase by about 88 per cent when it will be announced in line with the commencement of the new Multi Year Tariff Order (MYTO 2).
But, when he who met with the Senate Committee on Power in Abuja, the minister insisted that recent media reports claiming that all electricity tariffs would increase on April 1 by almost double were not factual.
According to a statement from his media aide, Mr. Cdon Adinuba, he told the committee that:“In fact, the urban poor and rural dwellers as well as artisans like welders who perform vital economic functions will experience no significant adjustment.”
He noted that a substantial percentage of people living in towns and cities would not pay much higher because they are among beneficiaries of the Federal Government’s N60 billion subsidy for this year as well as the N50billion subsidy next year.”
The minister argued that certain classes of electricity consumers are subsidised throughout the world, explained that electricity was a critical need, rather than a mere want of the people, especially in the modern times.
Revealing that by 2014, the government is expected to end its subsidy regime in the sector, Nnaji stated that even at that, the less affluent in the society would continue to enjoy subsidy but at the instance of the rich and other heavy electricity end users.
He also rejected suggestions that the planned introduction of different tariffs across the country would be abused by some wealthy people claiming to be poor to enjoy the incentive.
“The tariff will be determined by the wattage consumed by each customer”, those who consume less than 50 watts a month are considered less privileged and are known as Residential One (R1) customers. We have 14 classes of consumers,” he said.
He added that the new tariff was originally scheduled to start on January 1 as provided in the Multi Year Tariff Order (MYTO), which came into effect five years ago, but would now begin next May to allow for more improvements in power supply and greater public enlightenment on the ongoing reform of the power sector.
Comparing the situation to what happened with the telephone sector where the tariff reduced with time; the minister observed that the electricity tariff would eventually come down.
According to him, “The tariff being proposed is based on 4,500 megawatts,and it will come down considerably when we begin to generate 7000 megawatts and above.”
He equally assured that as much as the existing tariff has to be adjusted to attract both local and foreign investments in the power sector; the government has a duty to ensure that the people of Nigeria are not exploited.
“We devised an amortisation plan of 15 years, so that the people are not ripped; the power sector in Nigeria should not be for those who want hot money,” Nnaji stated.
Also, the Chairman of the Nigerian Electricity Regulatory Commission (NERC), Dr Sam Amadi, said that even with the proposed increase in the tariff paid by heavy electricity users, it would still be far cheaper than the cost of generation.
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