A fresh increase on the electricity bill being paid by the consumers may take effect if a proposal by power distribution companies to raise an average energy charge of N105 per kilowatt – hour from the current 22.8/kwh is approved.
This decision by the power firms to make the increment is said to be as a result of the unavailability of foreign exchange and the devaluation of naira which has led to massive inflation rate in the country.
Despite the economic recession which is affecting the entire nation, and the increment of about 45% in tariff which was implemented less than eight months ago on electricity consumers, the Discos have said this action was necessary in order to sustain the power firms.
A proposal to this effect has been forwarded to the Nigerian Electricity Regulatory Commission, but no action has been implemented yet.
The Chief Executive Officer of the Association of Nigerian Electricity Distributors, an umbrella body for the Discos, Mr Azu Obiaya, had said, “To review the tariff we will be looking at an average rate of N70 per kilowatt-hour for residential consumers. But some discos will like to have the rate as high as N105/Kwh.”
Azu, who also spoke on the sidelines of a power dialogue in Abuja on Thursday, stated the debts incurred by private homes, businesses and government ministries, departments and agencies post-privatization to the power distribution companies, amounted to N568billion.
He explained that these debts had affected the operations of the different discos, a development that had made it almost impossible for companies to meet targets set, and funds remitted, expected of them by the market operator.
Obiaya also said that, “Discos are experiencing revenue shortfall on a monthly basis of N38billion. As of June 2016, the MDAs owed the Discos N53bn post privatization.”
“The books of the Discos are so bad that they have no cash flow that is necessary for them to be taken seriously by any lender. “