Electricity Tariff Likely to Increase as NERC Concludes ‘Extraordinary Review’

Electricity tariff in the country are likely to increase following the conclusion of Extraordinary Tariff Review process for the 11 Electricity Distribution Companies (DisCos) in the country by the Nigerian Electricity Regulatory Commission (NERC).

The regulator of Nigeria’s power sector in a notice shared on its website and addressed to the general public and industry stakeholders, said the review was pursuant to the provisions of the Electric Power Sector Reform Act (EPSRA).

NERC said the extraordinary tariff review is as a result of changes in inflation, foreign exchange, gas prices, available generation capacity and capital expenditure.

The commission said it would also commence the processes for the July 2021 Minor Review of the Multi-Year Tariff Order (MYTO-2020), which is done every six months.

The statement read;

“The MYTO provides for Minor Reviews (every 6 Months), Major Reviews (every 5 years), and Extraordinary Tariff Reviews in instances where industry parameters have changed from those used in the operating tariffs to such an extent that a review is urgently required to maintain the viability of the industry.

“Further to the above, the Commission held series of Public Hearings and stakeholder consultations in the first quarter of 2020 on the Extraordinary Tariff Review Applications of the eleven (11) electricity distribution companies (“DisCos”) to consider their respective 5-year Performance Improvement Plans (“PIPs”).

“Accordingly, this notice is issued to inform the general public and industry stakeholders of the Commission’s intention to: Conclude the Extraordinary Tariff Review process for the eleven DisCos; Commence the processes for the July 2021 Minor Review of MYTO – 2020 to consider changes in inflation, foreign exchange, gas prices, available generation capacity, and CAPEX required to evacuate and distribute the said available generation capacity in accordance with EPSRA and other extant industry rules.

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“This notice is hereby issued in compliance with the provisions of EPSRA, the Business Rules of the Commission and the Regulations on Procedures for Electricity Tariff Reviews in the Nigerian Electricity Supply Industry to solicit for comments from the general public on the proposed reviews.

“Stakeholders and the general public are invited to send their comments to the Commission within 21 days from the date of this publication.”

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