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National President of Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and Chairman, OPSN Hajiya SaratuIiya Aliyu

OPS frown on FG  on increase of  electricity tariff

By Charles Nwaoguji

The Organised Private Sector of Nigeria (OPSN) comprising of the Nigerian Association of Chambers of Commerce Industry Mines and Agriculture (NACCIMA), the Manufacturers Association of Nigeria (MAN), the Nigeria Employers’ Consultative Association (NECA) the Nigerian Association of Small and Medium Scale Enterprises (NASME), and the Nigerian Association of Small Scale Industrialists (NASSI), had called on President Buhari’s Government to Justify the necessity for this tariff increase at a time when the economy is facing a potentially deep recession and Nigerians are facing increasing hardships, with unemployment rising to over 27% as many factories are facing total closure.

They noted that the subsidy situation is simply unsustainable, adding that if allowed to continue, the electricity industry will collapse as the government no longer has the fiscal capacity to sustain the increasing subsidy level and at the same time finance the capital investment necessary to extend electricity supply to the over 90 million Nigerians who lack access to electricity.

The Chairman of the OPSN, Hajiya Saratu Iya Aliyu;  who stated this when she and her team visited the  Special Adviser to the President on Infrastructure, recently in Abuja  said that it is therefore necessary to create conditions that will attract private investment in the Industry for which cost reflective tariff is inevitable.

Saratu Iya Aliyu said that It is however imperative that the confidence of electricity consumers must be inspired and they must be assured that the new tariff regime will lead to significant and sustained improvement in the quantity and quality of electricity supply.

She noted that the new tariff structure must be transparent, charges must be fair and consumers must be able to verify that they are paying only for what they consume.

She explained that government must compel distribution companies(DISCOS) to massively invest in a metering program that will totally eliminate estimated billing which they (DISCOS) routinely resortto, to extort money from consumers to boost their revenue and make up for their chronic inefficiencies. The metering program through Central Bank, to fund locally made meter manufacturing bulk purchase should be accelerated;

“Measures that should ease the burden of industrial consumers must be implemented even if as temporary arrangements. This is to enable them to sustain operations and remain competitive without resorting to laying off employees. Such measures as the Eligible Customer Scheme, which has been approved by NERC but has been blocked by Distribution Companies must be allowed to come into play without any further delay,” she observed;

In the interest of the increasing number of Nigerian workers who are facing retrenchment under the prevailing high cost operating environment, she said that  the government must explore all avenues for supporting industries to remain viable.

She called on the government to review the current policy on border closure as this the only way to revive the economy.

Responding, the  Special Adviser to the President on Infrastructure said that the government is facing serious financial quagmire in which the government has found itself which has made it impossible for the government to continue to sink hundreds of billions of Naira into the Electricity Industry without any positive improvement in the supply of electricity to consumers.

He stated  that over the past five years, subsidy on electricity has skyrocketed from N165 billion in 2015 to over ₦500 billion in 2019 superseding the FGN budgetary allocations to health and education combined, adding that these figures were also confirmed from the recent Senate Committee on Power’s Investigative hearing in June, 2020.

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