Forex and Inflation to Drive Hike in Electricity Tariff Every 6 Months, Says NERC
- The Nigeria Electricity Commission (NERC) has said electricity tariff will rise every six months to adjust to forex and inflation demands
- The Commission's Chairma, Sanusi Gbarba said the current collapse of the national grid was caused by a trip off
- Garba also said that the reason the federal government withdrew subsidy from the electricity sector was because it is unsustainable
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Nigeria’s electricity regulator, the Nigerian Electricity Regulatory Commission (NERC) says Nigerian should expect electricity hikes twice yearly.
Reason for the hike
This, NERC says, is due to rising inflation and adjustment in foreign exchange requirements.
Sanusi Garba, Chairman of NERC said this in Abuja on Wednesday, March 16, 2022, according to a report by the News Agency of Nigeria (NAN).
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NERC also clarified the reason for the collapse of the national grid, saying it was caused by a trip off of the conductor snap that began from the 330 Kil Volt Ampre (KVA) from the Benin axis and also vandalised pipelines that supply the power plants.
The NERC helmsman said that the decision to halt electricity subsidy was that, at some time, it was as high as N600 billion yearly and was reduced to about N30 billion this year.
What the NERC is saying
Garba revealed that there was an adjustment in tariff in February this year due to some economic considerations.
“What happened on February 1, 2022, is a minor review of tariff. It is very clear on our website that every six months we will adjust rates to take care of the foreign exchange component of cost and also inflation."
The NERC boss cautioned that the country’s electricity sector cannot continue to operate on subsidy and that investors should find a way to make a profit without government intervention.
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He warned that Nigeria’s electricity industry can not be operated on life support and that investors should be able to get their return on investment without the government stepping in to provide the required funding, adding that the DisCos are to inform customers on tariff changes, Nairametrics reports.
National grid has been restored, says Minister
Legit.ng has reported that the current challenges of electricity supply in Nigeria are being resolved with the ongoing restoration of normal operations, the minister of power, Abubakar Aliyu.
Early in the week, the national grid suffered a decrease in electricity due to so many factors. However, more of the power is being restored.
The current energy crisis confronting some key sectors of the economy also contributed to the problems the country is facing in the power sector, Legit.ng gathered.