We are appealing to organized labour and fellow compatriots to please join hands with the Federal Government and the power sector operators, as we continue to work to improve the supply of electricity in the country.
For the first time in the history of Nigeria’s power sector, electricity generation has hit an all-time high of 5,075MW, demonstrating the evolution and progress in the capacity of the sector to meet the country’s power needs, a major requirement in the drive to grow the nation’s economy and improve quality of life.
Nigeria’s growth has been crippled for far too long by decades-old deficiencies in the power sector. Private sector-driven efficiency and realistic market prices can, and are already giving the sector a new lease of life. The recent attainment of 5,075MW generated, transmitted and distributed has to be viewed in the context of a sector that barely generated 2,000MW, prior to the start of the sector reforms, a little over five years ago. We believe that this is only the beginning and that we can accomplish much more improvement in the sector, if all the stakeholders work together in partnership.
A power sector that delivers fully on its mandate to provide electricity, sufficient to drive the economy of Africa’s largest economy and the 22nd largest economy in the world, is for the mutual benefit of all Nigerians. Achieving this goal, should be our collective objective – investors, operators and customers alike.
The Association of Nigeria Electricity Distributors (ANED), on behalf of its members, would like to reassure all electricity customers, nationwide, that the continued increase in generation over the last few months will continue to translate into more electricity that is supplied to their homes and businesses. Distribution Companies (DisCos) will continue to do all that they can do, to distribute power that is transmitted to them.
ANED and its members are sensitive to customer anxiety over the recent increase in electricity tariffs. As such, we hereby provide our customers an assurance that the increase is no more than that which is necessary for critical improvement of an electricity infrastructure that has suffered decades of neglect. The increase will help to mitigate the negative cash flow and revenue shortfalls that have bedeviled the sector since the handover of the assets to private operators, hindering the ability of the generators to increase power supply, due to their inability to pay their gas suppliers; constraining the wheeling capacity of the Transmission Company of Nigeria (TCN), due to the lack of receipt of revenues for rehabilitating, replacing and expanding grid infrastructure; and limiting the ability of DisCos to procure and install urgently needed meters, extend distribution networks and provide improved customer service options of automated vending, online bill payment and setting up customer call centers.
Importantly, we must point out that even with the increase in tariffs, the cost of self-generated power, currently estimated to be between N45 to N70 per Khw, is still significantly more than the cost of grid supplied power. And this is without considering the additional benefits to our environment, of minimizing the use of generators and a reduction in their related emission of pollutants.
The good news is that with the increased investment that will occur, as a result of the ability of the operators to generate a credible cash flow that will, in turn, provide them with access to financing for investment in distribution, generation and transmission infrastructure, the cost of electricity supply and distribution will be reduced. This reduction, as a result of increased investment and efficiency gains, will result in lower tariffs for electricity customers. This projection is consistent with similar electricity reforms that have taken place all over the world. It is empirically supported.
In view of the aforementioned, our customers do have a reason to believe that the sorely needed improvement in the state of the sector will come to pass. Indeed, as an indication of our good faith to work towards such improvement, and in recognition of the concerns expressed by our customers, Fixed Charges were removed from the recently implemented tariff. Removal of the Fixed Charges constitutes a revenue risk to the operators, but it is a risk that we are prepared to take, as necessary to march in lockstep with our customers and loudly convey that that the sector’s players are making every possible effort to ensure that affordable, sustainable and appropriately priced power is delivered to your homes and businesses.
Ours is a long journey, with potential bumps and possibly some diversions. Regardless, it must be a journey that remains focused on reaching the destination. It must be a journey in which we all work together as a team to achieve our objective. Working as a team requires that we all own our respective responsibilities. As such, customers must own the responsibility of paying for power that they consume. Customers must own the responsibility of dissuading or helping in policing those who engage in electricity theft. Every kWh of energy that is stolen is a KWh of energy that all of us legitimate electricity customers must pay for. In addition, a revived power sector will also hurt some ‘new businesses’ that depend on a moribund power sector to thrive. Consequently, we should also be sure that we do not play into the hands of the proponents schemes and practices that only harm our economy, as a nation, and our quality of life, as individuals.
Grievances that we have against the system that has functioned poorly over the last 50 years should not be transferred to operators who have put their investments at risk and are working hard to inject capital and entrepreneurial expertise into turning around the sector, for the greater good of the Nigerian electricity customer.
Of critical note is that these operators, with the purchase of majority ownership, full ownership and under concession agreements, transferred $2.4 Billion to the Federal Government, of which, an estimated N7.7 Billion was paid to the electricity labour unions, based on its legacy relationship with the Power Holding Company of Nigeria (PHCN) and as far back as its relationship with the Nigerian Electricity Power Authority (NEPA).
However, we believe that we have approached a new dawn. It is time to move away from the old thinking of threats, intimidation and the pursuit of the old gratuitous “something for nothing” thinking or attitude and join hands in productively moving the sector forward, with creativity, focused thinking and an eye on the prize.
. Being a statement by the Association of Nigeria Electricity Distributors on the planned protest by the Nigeria Labour Congress over the increase in electricity tariff.
Trending
- Four dead, 70 vehicles burnt in fuel tanker explosion in Rivers – Police
- Navy recruits 1,486 to tackle oil theft, piracy – Minister
- Ondo 2024: Sowore’s party’s candidate emerges
- LG poll: OYSIEC apologises for lateness, speaks on alternative to voter card
- Breaking: Olukoyede restructures EFCC, appoints CoS, Zonal Directors
- 19 children feared killed by measles complications in Adamawa
- NCoS speaks on reported one-bedroom flat for Bobrisky
- Gombe LG polls: Ruling party sweeps all positions