NERC suspends new tariff increase for 2 weeks

The Federal Government has halted the implementation of the new Service Based Electricity Tariff increase for two weeks.

The suspension follows the agreement reached between the Federal Government and organized labour on Sunday night that led to the cancellation of nationwide industrial action by workers to protest the increase in electricity tariff and the pump price of petrol.

The Nigerian Electricity Regulatory Commission (NERC) on Tuesday night in an Order directed electricity distribution companies to suspend the tariff increase.

The Order which was signed by NERC Chairman, James Momoh and Commissioner, Legal, Licensing and Compliance, Dafe Akpeneye said “This Order shall take effect from 28h September 2020 and shall cease to effect on the 11th October 2020.

The Order read: “The Commission, pursuant to sections 32 and 76 of the Electric Power Sector Reform Act (“EPSRA”), issued the Multi-Year Tariff Order 2020 for the 11 successor electricity distribution companies (“DisCos”) with effect from 1 September 2020. One of the primary objectives of the MYTO 2020 Order is ensuring that rates charged by DisCos are fair to customers and are sufficient to allow DisCos that operate efficiently to recover the full cost of their activities, including a reasonable return on the capital invested in the business.

“Following a joint communique issued by the Federal Government of Nigeria and the labour unions, the FGN agreed that the recent review in electricity tariffs would be suspended by the Commission for a period of 14 days to further consultations and finalisation of negotiations between the parties.

“Section 33 of EPSRA provides that “the Minister may issue general policy directions to the Commission on matters concerning electricity, including directions on overall system planning and coordination, which the Commission TORY shall take into consideration in discharging its functions under section 32(2), provided that such directions are not on conflict with this Act or the Constitution of the Federal Republic of Nigeria.

“The Secretary to the Government of the Federation, Minister of Power and other Ministers were part of the FGN team that issued the communique which the Commission duly accepts as a general policy direction in accordance with section 33 of EPSRA”.

The commission then ordered the suspension Multi Year Tariff Order issued to the DisCos “for a period of 14-days, with effect from 28 September 2020 to 11 October 2020”.

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