In a swift response to public outcry, the House of Representatives has issued a directive compelling the Nigerian Electricity Regulatory Commission (NERC) to suspend the implementation of the recently announced electricity tariff increase.
The House also mandated the suspension of other conditions outlined in the newly issued Multi-Year Tariff Order review.
A special committee comprising the Committees on Power, Commerce, Delegated Legislation, and National Planning has been established to conduct a structured hearing on the price regulation of the Nigerian Electricity Supply Industry (NESI).
This hearing, slated to include key stakeholders such as the Minister of Power, Chairman and Commissioners of NERC, CEOs of all electricity utilities in Nigeria, and representatives from the Nigeria Labour Congress and the Trade Union Congress (TUC), aims to foster transparency and inclusivity in the tariff review process.
Furthermore, the House has resolved to appoint a respected former regulator as a technical consultant to develop templates for assessing the legality and reasonableness of the tariff increase procedure approved by NERC.
The consultant will collaborate with the special committee to draft a bill aimed at establishing administrative procedures that ensure proper consultation and legislative review of tariff setting processes in the electricity and other public service sectors in Nigeria.
These resolutions stem from a motion of urgent importance moved by Honorable Nkemkanma Kama, highlighting the pressing need to address concerns surrounding the sudden hike in electricity prices in Nigeria.
Nkemkanma said, “It highlights concerns over due process, fairness, and the impact on consumers. The motion aims to restore public trust, protect consumer rights, and ensure regulatory accountability in the Nigerian Electricity Supply Industry (NESI).
“The facts presented include the alarming tariff increase announced by the Nigerian Electricity Regulatory Commission (NERC) on April 1, 2023, resulting in a staggering 300% rise for certain consumers.
“However, what’s more concerning are the reports indicating discrepancies in customer categorisation and widespread complaints regarding inadequate service despite increased charges.
“This situation has not just sparked national anxiety, but it also threatens regulatory certainty and investor confidence in the sector, demanding immediate attention.”
According to him, the motion argues for legislative intervention, underlining the constitutional and moral obligations to address the crisis and alleviate the burden on Nigerian citizens.
He said, “It places a strong emphasis on the legislative oversight role over NERC and the electricity utilities, stressing the need for fair and just pricing and consultation with stakeholders in tariff determination processes. This is not just a responsibility, but a duty we owe to our constituents.
“Key issues highlighted include the failure of due process in approving the tariff increase, concerns over discriminatory practices, and the disputed nature of government subsidies to electricity distribution companies (DISCOs).
“The motion proposes resolutions to suspend the recent tariff increases, establish a special committee for hearings involving relevant stakeholders, appoint a technical consultant to assess the legality and reasonableness of NERC’s procedures, and draft a bill to improve regulatory processes in tariff setting.
“Overall, this motion underscores the importance of legislative action to address the challenges facing the electricity sector and ensure fair treatment of consumers while promoting transparency and accountability in regulatory decision-making.”
Earlier on Monday, at the Senate Committee on Power hearing, Adebayo Adelabu, Minister of Power, had defended the tariff hike arguing that it was no longer possible for the Federal Government to provide subsidies on power.
He posited that for the power sector to be revived, there was a need for the government to spend about $10 billion annually in the next 10 years.
“This is because of the infrastructure requirement for the stability of the sector, but the government cannot afford that,” he said.
As the House of Representatives takes decisive action to address public concerns and ensure a fair and transparent tariff setting process, stakeholders await the outcome of the structured hearing and the subsequent legislative measures aimed at safeguarding the interests of consumers and promoting accountability in the electricity sector.