The regime of inappropriate electricity tariff in Nigeria will likely continue to deny electricity consumers satisfactory service from discos.
“This is because if all the electricity value chain is not adequately covered with appropriate tariff there would always be hiccups in the supply chain which will have consequences on the economy”
Ola Alokolaro, a partner at ADVOCAAT LAW PRACTICE said this while speaking on the current electricity situation and benefits associated with having appropriate tariff in the electricity sector.
He said for the industry to work, electricity supply must be duly paid for stating that the real price of electricity is not what we have at the moment in the country.
According to him, what is operational is a subsidised price adding that he is not too sure how long we would continue to subsidise the entire energy industry.”
He believes there should be enlightenment of the people about the power sector on the need for consumers to pay appropriate tariff. “We can begin to educate people at the bottom of the chain that electricity is not free, and then we would be getting people ready to pay the true price of electricity.”
Another reason for appropriate billing, he said is the fact that the cost of gas production is settled in dollars while electricity tariff is paid in naira. He said consumer should have ability to pay for the electricity if the true price is passed down.
“It is important that we have gas in abundance, it is important that gas is priced properly and it is also important that the power supplied is paid for appropriately,” he said.
Subsidies, he stated, ultimately affects the bottom-line of governance and the ability of government to invest in other sectors such as schools and hospitals.
Expressing his views on Eligible Demand and Embedded Power policies, he said: “Let’s see the two policies that were introduced. You see we have the generation, transmission and have you have distribution. In terms of generation we have generating capacity of about 7000 megawatts (MW) and of this what we are able to wheel is about 3,000mw. For a population almost 200million, if you do the mathematics this is not good enough for a nation that wants to industrialise”.
“You have the discos that are having challenges in terms of being able to get revenue. You have the interlink between the generators and the distribution companies which is the transmission where you have old and worn out wires that needs to be repaired and replaced. Now you can imagine the huge distances the transmission lines pass through across the country and it is through this line that electricity has to be transported through. You can even see with the frequent system collapse and total blackout we have in the country”.
