It is trite to say when it comes to electricity; Nigerians have been compelled to pay more for darkness, so last week’s decision by the Senate ordering the Nigerian Electricity Regulatory Commission (NERC) to halt the proposed 45% increase in tariff is a bold and praise-worthy gesture. Ordinarily, the hike was unnecessary since there hasn’t been any corresponding improvement in power supply. By this action, the Senate has demonstrably given vent to the frustrations of electricity consumers, who are being robbed blind by unscrupulous power generating and distribution companies. Tariff hikes without a corresponding increase in power supply is immoral. There is no justifiable basis for Nigerians to pay for what is not available. That is official daylight robbery. Nigerians need a respite from the unbearable economic hardship in the country.
Adopting a two-prayer motion moved by Suleiman Nazif (APC Bauchi North), the Senate directed its Committee on Labor to carefully review the law establishing NERC with the aim of strengthening its regulatory capacity to ensure proper and pocket-friendly billing systems to protect consumers. Nazif observed that the hike would have a negative multiplier effect on the economy with manufacturing companies paying more for electricity, stressing that due process for such increase was not followed in consonance with Section 76 of the 2005 Power Sector Reform Act. He also noted that the distribution companies (discos) had continued to exploit Nigerians through an estimated billing system for the majority of consumers while deliberately refusing to make pre-paid meters available, in violation of the signed privatization Memorandum of Understanding (MoU) of November 2013, which stipulated that within 18 months gestation period, all consumers are to be metered.
The increased electricity tariff was the fourth since the privatization of the power sector in 2013. It is inappropriate, insensitive and anti-people; a sad commentary on Nigeria, coming amid the recent disclosure that as many as 120 million Nigerians (out of a population of 170) are currently without electricity. This is totally unacceptable. There is no justification for compounding the people’s poverty and misery, by imposing on them an increased tariff to compensate an inefficient system.
The logic of hiking electricity tariff as a precondition for private investor participation is certainly, not in the national interest. If the increase is aimed at pleasing investors, it is certainly injurious to the interest of Nigerians, as it amounts to subjecting them to more suffering, indeed double jeopardy. People are not supposed to pay for what is non-existent. The ideal thing is to work towards putting power first. Thereafter, it would be clear to all and sundry that there is a change that could warrant tariff increase. As it is, there is no guarantee that after subjecting consumers to high charges, there would be any commensurate increase in power supply.
Some have rightly said that the greatest evidence of leadership failure is the embarrassing state of power supply. In short, what Nigeria is witnessing is a crisis in the power sector, created by failure of governance. Although, there have been efforts towards privatization, unbundling of the PHCN, these have not crystallized into improved electricity supply, which is all Nigerians want. It is regrettable that despite the much-flaunted reforms in the power sector, little has changed. Rather than improving, the situation has getting worse. Between 1999 and 2007, the Obasanjo administration embarked on a reform program that focused mainly on independent power projects (IPP). Despite the $16 billion pumped into the power sector since 1999, amid many promises of increased electricity generation, no part of the country has constant and uninterrupted power supply.
In his inaugural address, then President Jonathan promised that power sector reform would be at the heart of his administration’s industrialization strategy. Thereafter, the Jonathan administration launched a bold “Power Sector Roadmap”, which many saw as a potent framework to redeem the comatose electricity sub-sector. The framework contained policies and institutional reforms that promised, among other things, a super transmission network, generation of additional 5,000 megawatts by international oil companies, active exploitation of hydro, nuclear and coal power, and addition of 4,775 megawatts from the Independent Power Plants (IPPs) by December 2013. The medium term expectation was that by the end of 2013, the country would have attained 14,000 megawatts power generation capacity.
At that time, power generation was about 3,500 megawatts. Over five years after, and billions of naira spent, this miserable figure has increased by no more than an even more miserable 1,000 megawatts. Working under the power sector reform agenda, the unbundled Power Holding Company of Nigeria (PHCN), was sold and handed over to new private investors. The expectation was that there would be significant improvement in power supply. But rather than see improvement, power supply has dropped even more to the unbearable discomfort of Nigerians.
It would take a miracle to achieve the transformation of a country in perpetual black-out. Meantime, Nigerians have to pay for the failure of the system. In real terms, citizens are being victimized and treated with disdain as it is fraudulent to make people pay for capacity, rather than what is produced or consumed. Now that government has declared its intention to achieve 10% target on renewable energy by 2025, what plans are on ground to meet this target? As a developing nation, renewable energy should account for no less than 20% total power needs. No doubt, renewable energy is cheap and environmentally friendly.
Nigeria is blessed with abundant sunlight, wind, rain, tides, waves and geothermal energy. These are natural energy sources that should be exploited for beneficial use. A well-articulated and carefully implemented energy mix would go a long way to bridge the gap in electricity supply, particularly in the rural areas. This alternative should, therefore, be diligently explored. It is important to state that President Buhari must deliver on his campaign promises to transform the power sector for history to judge him fairly.
