ELECTRICITY tariffs have been increased; consumers are complaining and NLC has risen in condemnation of the increase as expected of a grassroots organisation. Their arguments range from wrong timing, fleecing of consumers through estimated billing to the magnitude of the increase. Obviously the stakeholders’ consultations held by NERC prior to the increase did not make any impact. This writer seeks to examine the issues at the stake.
Timing of tariff increase
The main argument against the increase centres on inadequacy of power supply. Consumers clamour for improvement in supply situation before any tariff increase. The argument is not new; it is as old as the reform process and it held sway for some time especially under former President Olusegun Obasanjo. President Johnathan under whose tenure the new tariffs were approved held back on the implementation because of last year’s general elections; clearly it would have been a suicidal political action in an election year.
Tying tariff increase to improvement in power supply is akin to the age-old riddle of the chicken and egg, which comes first? The argument held sway for as long as the sector was owned, managed and funded by government. Government businesses are hardly meant to be profitable especially when provision of critical infrastructure is involved. We must recognise the fact that the game has changed; government is no longer in control; its involvement is minimal – policy formulation and regulation. The regulatory role involves protection of customers’ rights wherein falls tariff review and adjustment.