Power sector loss hits N1.7trillion

The Nigeria Electricity Regulatory Commission (NERC) has said that the entire market participants in the Nigeria Electricity Supply Industry (NESI) recorded a total of N1.7 trillion tariff-related shortfall between 2015-2019.

It insisted that in view of the fact that the core investors in electricity distribution companies (DisCos) are under contractual obligations to reduce the loss levels in the industry, it is expected that tariffs would eventually come down as a result of the efficiency gains and increased energy through output.

It would be recalled that the National Assembly has prevailed on NERC to suspend the implementation of the tariff increase.

Read Also: More Cameroonians flee into Nigeria over violence

But the commission on Thursday said that in order to mitigate the impact of rate shock on consumers, it is proposed that the gradual increase shall commence on April 1, 2020.

In a document titled “Consultation paper on the proposed extra -ordinary tariff review of the MYTO -2015 Tariff Order for the Nigerian Electricity Supply Industry (NESI)”, the commission described the financial gap as “an unsustainable fiscal burden on the Nigerian treasury.”

The document which The Nation sighted in Abuja yesterday said that “while the intervention so far represents an unsustainable fiscal burden on the Nigerian treasury, the total tariff-related revenue shortfall for all market participants for the period 2015 – 2019 is in the sum of N1.72 trillion.”

Meanwhile, the House of Representatives has asked the federal government to declare a state of emergency on the country’s power sector. It said the huge investment in the sector has not yielded any positive result.

The House also resolved to investigate the sector with a view to finding out why none of the DISCOs that benefitted from the privatisation exercise has not invested a single kobo in the power sector.

The resolution followed a motion of urgent public importance on the need to declare a state of emergency on the power sector sponsored by Rep. Nnolim Nnaji.