The Deputy Governor of Lagos State, Obafemi Hamzat, spoke about the power sector the other day, and I wondered how many Nigerians heard him. In particular, I wondered if the players here who ought to hear him actually did. Hamzat said one thing, but his words echoed several other challenges in this sector. Hamzat spoke at an event in Lagos, where power generation and distribution to consumers were in focus. In attendance, too, were participants from the Rural Electrification Agency and the Lagos State Government.
Hamzat explained, “People that are trying to survive, and the common denominator for them is power. They don’t have power. There are billing challenges. In fact I’m a very good example.
“Last month, in my house, or the state house that I live in, the bill was N2.7m last month. This month, Eko DisCo sent us a bill of N29m. I sent it to the Commissioner for Energy. It’s crazy. I actually procured a meter. I bought a meter to say, Look, don’t give estimated billing. I bought the meter, but to convert it is wahala. There is a place called Coker Aguda in Surulere, and people came to me, and I was asking them to calm down. A man’s rent in a year is about N2m; they gave him a bill of N2.8m for electricity. How can the bill be more than the man’s rent for a year? Those are the challenges that we have. Our people are suffering because of estimated billing.”
I quoted Hamzat at some length because, I judge, paraphrasing him wouldn’t convey the very energy in what he said. “Our people are suffering because of estimated billing.” That can only come from a public official who feels strongly about the difficulties people are experiencing. You don’t hear public officials talk like that every day. On a normal note, Hamzat is a man of considerable energy, as could be seen in every public comment he makes. I don’t even mean physical energy; I mean Hamzat’s heart is in what he says. He says what he believes in. This always comes across. No hiding it. Now, why did I take note of what Hamzat said? One reason was that in recent months, I interrogated several issues related to the power sector on this page.
I pointed out some of the challenges consumers faced, which no one in relevant places appeared to want to talk about. Officials say other things about the sector but avoid discussing the difficulties consumers face. However, here is the deputy governor of the most active state in Nigeria stepping in on behalf of consumers. I’ve not heard a public official speak in the passionate manner Hamzat did lately regarding the everyday problems this sector gives Nigerians. Imagine him taking action to ensure the Lagos State Government isn’t ripped off through estimated bills generated from someone’s imagination. This is the electricity bill for his official residence, for which Hamzat doesn’t have to settle. Most public officers in official residences are quiet about this form of looting. Why? It’s not their money that is being looted. It’s “government money”. And “government money” is nobody’s money. However, Hamzat’s disposition about the utilisation of public resources is quite different.
The concerns Hamzat expressed reminded me of a friend who started his business long before he left the university. He made supplies to companies. Then he ventured into executing contracts for government. In those days, I sometimes met him at the sites where he refurbished one government structure or the other. After a long while, I asked him if he was still taking jobs from government. He said, No. Why? He said government officials made him sign for an amount as payment, but they collected a huge percentage for their pockets. He said officials were looting money meant for his people, and he didn’t want to defraud his own people. So, he went into other lines of business. How many Nigerians think like my friend? How many Nigerians in public offices try to ensure government money is not frittered as Hamzat’s efforts show? For billing N29m this month for electricity consumption that was billed N2.7m the previous month was exactly that – daylight looting of government money.
Linked inevitably to the concerns Hamzat expressed is the poor quality of service in the power sector which everyone talks about, including manufacturers. For instance, the Manufacturers Association of Nigeria through its director-general said it spent N1.11tn on alternative energy sources in 2024 due to persistent power supply challenges. To put this in context, MAN said energy-related costs rose by 42.3 per cent from the N781.68bn recorded in 2023, as operators battled frequent grid collapses and surging diesel and petrol prices. Furthermore, manufacturers spent N404.80bn in the first half of 2024; this jumped by 75 per cent to N708.07bn in the second half of the same year. Here, inadequate and unreliable power supply drove manufacturers’ high energy costs. While electricity supply rose from 11.4 hours per day in the first half of 2024 to 15.2 hours in the second half of 2024, electricity tariffs surged by over 200 per cent for Band A consumers, thus significantly increasing manufacturing costs. This narrative mirrored what Hamzat said, except that the higher tariffs he mentioned happened to Nigerians who didn’t manufacture a single thing, let alone make a profit.
On the other hand, despite the sector’s poor showing, the Federal Government announced that it currently owed both the electricity generation companies and distribution companies over N4tn. A breakdown shows that the government is indebted to GenCos to the tune of over N2tn, while there is an outstanding unpaid subsidy for 2024 of N1.97tn. Also, the government owes the DisCos N450bn for the electricity subsidy that accrued in 2024. But there is a question here. Just as citizens complain about unfair tariffs, have the parameters used to calculate these debts that the government said it owed been fair? Or, are the debts an outcome of a similar situation at Hamzat’s official residence, which was billed for N2.7m the previous month but rose to N29m one month later? It’s a vital question because some government-owned institutions have raised an alarm about estimated billings given to them.
This was a case a few years ago at the Ahmadu Bello University, Zaria, under the then transparent and indefatigable vice-chancellor, Prof. Ibrahim Garba. At the time, Garba was so concerned about over N80m a DisCo asked ABU to pay regularly that he demanded that any payment should be based on some definite parameters. He said he wouldn’t release the school’s scarce resources based on estimated billing. He didn’t budge until that was resolved in his favour. So, I ask again, how many in government positions conduct the affairs of government like this? Most just go along with the fleecing called estimated billing because it’s government money.
In addition to the challenges in the power sector is the dim view the Federal Competition and Consumer Protection Commission has of DisCos. Recently, at a forum in Ota, Ogun State, FCCPC ordered the Ibadan DisCo to refund whatever consumers have invested in purchasing transformers and other items. The regulatory body says it’s not the duty of consumers to purchase such items, insisting that any such investment must be refunded by the DISCO. However, rather than admit it has funds to give back to consumers in this regard, the Ibadan DisCo boss in Ogun State blamed consumers for buying transformers without carrying the DisCo along.
He said consumers ought to inform the Nigerian Electricity Regulatory Commission of their intention to procure transformers and other items needed for electricity supply in their areas before going ahead to procure them. To this, the FCCPC disagreed, insisting consumers did not need to purchase any material, and they did not need to inform anyone about purchasing it. This is the confusion in the power sector in which consumers are trapped. It was an aspect of it that Hamzat commented on the other time, essentially calling attention to the need to reduce the burden the sector has placed on Nigerians. And he deserves appreciation from all, because this is a sector that has fully retired into fleecing helpless citizens and even governments to fund its inefficiency.
By Tunji Ajibade
