Emmanuel Sixtus: Correspondent
Background
Lagos Nigeria| The latest move by the Nigerian Electricity Regulatory Commission (NERC) to raise electricity tariffs has stirred a profound wave of controversy and public outcry across the nation.
The hike is coming at a time when the economic situation of the country is biting hardest in the long history of the country.
The tariff hike, which was implemented at the beginning of September, has been received with widespread opposition and criticism from consumers, civil society organisations, and industry experts, who said that the timing is critical and that the increase is a heavy burden on the average Nigerian.
The country’s Electricity Regulatory Commission has been accused of being insensitive to the plight of the people and said to be following the ‘I don’t care’ life of the president who believes that he can do as it pleases him.
NERC announced the new tariff structure in August, detailing that the adjustment was crucial to reflect the true cost of electricity generation and distribution. The commission has been incessantly and continuously increasing the electricity tariff every year.
According to the Commission, this increase is important to ensure the sustainability of the power sector, attract investment, and improve the quality of electricity supply.
The commission is also bedevilled by corruption, with every explanation to the public being viewed as a pretext to continue to milk the people.
However, many Nigerians, already struggling with high living costs due to inflation and the removal of fuel subsidy, see the hike as an additional strain on their finances.
A tariff increase coming at a time when the people yearn for subsidy in virtually everything the country could offer gives no hope of relief any time soon.
The tariff increase varies across different consumer categories, with higher rates being slapped on residential users in urban areas.
Small and medium-sized enterprises (SMEs), which rely notably on electricity for their operations, are also expected to bear the brunt of the new pricing structure.
Effect
Despite the tariff hike, the commission often fails to power the country and often relies on estimated bills instead of prepaid.
The acquisition of prepaid meters has become somewhat impossible, with the commission failing to provide enough for the people.
“The people always complain about lack of power, the power fails sometimes two days or more, and at the end of the month, they carelessly bring an estimated bill that must be paid. They barely ask if the people got the value of their money,” a consumer said in protest.
Many business owners have voiced concerns that the higher electricity costs could lead to increased operational expenses, forcing them to raise prices on goods and services or, in some cases, reduce their workforce.
The hike in electricity tariff also hurts the economy of the country, and makes life even harder for the people.
For each increase in electricity tariff, consumers tend to increase their commodities to balance their books, which further causes inflation and economic hardship.
Critics
The timing of the hike has been a specifically contentious issue. Critics argue that implementing the increase during a period of economic hardship, characterised by rising inflation and a depreciating naira, will worsen the financial struggles of ordinary Nigerians.
They also wondered why the government should continue to pursue increments of government served commodities instead of try to mitigate inflation and give the people the landscape to thrive and turn around the bad economic situation of the country.
Labour Threatens Action
Labour unions and consumer rights groups have called for the immediate reversal of the tariff hike, threatening nationwide protests if the government does not intervene.
Labour unions and consumer rights groups believe that the increment is wicked at a time when the country is already bleeding.
The groups are of the opinion that the government simply doesn’t want to do anything to help alleviate the pains of the people as a result of economic hardship.
A labour action will ultimately have effect, but the government has shown time without number its willingness to detain labour leaders who go against its dictates in the country.
NERC Reacts
In reaction to the backlash, NERC has defended its move, explaining that the increase is important to ensure the financial viability of the power sector.
The Commission argues that without sufficient funding, electricity distribution companies (DisCos) will continue to struggle with providing consistent and durable power, leading to further decline of services.
NERC has also promised that the increased revenue will be invested in infrastructure improvements, with the plan to reduce the frequent blackouts and power outages that have plagued the country’s power distribution for years.
Public Scepticism
Despite these assurances, public scepticism remains high. Many Nigerians doubt whether the additional funds will be truly and effectively utilised, given the persistent issues of corruption and mismanagement within the power sector.
This is not the first time the commission has increased tariffs with nothing to show for it.
“Previous tariff increases have often failed to result in noticeable improvements in electricity supply, leaving consumers frustrated and disillusioned,” a critic who doesn’t want his name in print said.
The Nigerian government, for its part, has pleaded citizens to be patient, saying that the tariff hike is part of broader reforms aimed at revitalising the power sector.
The reply has become a trend in the country’s political system, and most people believe it’s just for saying sake.
Conclusion
President Bola Tinubu’s administration has reiterated its commitment to improving the country’s energy challenges and has outlined plans for increased investment in renewable energy resources, which could eventually lower electricity costs.
But since the vow, the government has not made any decent move towards implementation.
As the debate over the tariff hike continues, the government and NERC are under significant pressure to find a balance between ensuring the sustainability of the power sector and protecting consumers from excessive financial burdens.
The coming weeks are likely to see intensified discussions between stakeholders as the country grapples with the implications of this controversial policy.
Whatever comes out of any discussion will effectively mark a new beginning in the crisis between consumers and the NERC.
