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When the Nigeria Labour Congress (NLC) rolled out the war drums on February 8, 2016 , in a nationwide protest against the planned increase in electricity tariff by the Nigerian Electricity Regulatory Commission (NERC) under a firm believe that poverty-stricken Nigerians will further be pauperized if the increase is sustained, I converse within myself to know if Nigerians are truly in need of steady power supply or have they been inflicted with the Stockholm syndrome that they are loving their condition of perpetual darkness. The recurring theme during the protest was that Nigerians will not pay more for darkness, continue to be subjected to estimated billing and demand that meters should be provided for all consumers even before muting the idea of any increase. Laudable as the demands are, it is rather unfortunate that, since the protest, the flash of progress witnessed in the power sector in the early days of this administration has declined to a near total blackout across the country.
The Nigerian Electricity Regulatory Commission, NERC, under a Multi-Year Tariff Order, MYTO 2.1 approved electricity tariffs increase by pegging the increment between N9.60 and N14.80, which was supposed to be effective from February 1, 2016. It also announced the removal of fixed power charges for all classes of electricity consumers, stressing that power users would henceforth only pay for what they consume. The new tariff rate according to NERC will last till December 2018 and Consumers might even enjoy a decrease in what they pay as the years progress. From the position of the Regulator and Distribution Companies (Discos) the increase in tariffs was necessary for improvement of electricity infrastructure that had suffered decades of neglect. It is believed that the increase will help to mitigate the negative cash flow and revenue shortfalls that have bedeviled the power sector.
Going by the undeniable revelation by Minister of Power, Works and Housing, Mr. Babatunde Fashola, it is obvious one of the major problems with the power sector is the way and manner the privatization process was handled; cronies and friends who lack fund took over a prime sector needing huge funding to achieve a turnaround. Rather than lament, the Minister is of the opinion that Nigerians proceed from where we are albeit with some level of sacrifice and trust in the current government to fix the situation. “This is a problem that has been here for 16 years if we put it mildly. It is a problem that has been here 100 years ago if we put it really extremely… I think we can solve this problem if you give us the tools that we need to do it. I think that this problem can be solved, and the day that we feel that it cannot be solved, I will gladly come and tell you that I don’t think it will work,” Fashola was quoted to have said in one of his effort to justify the increase in tariff.
Despite the potential of good return on investment inherent in the power sector considering the huge volume of consumers as occasioned by Nigeria’s population, it is believed that institutional investors are skeptical of investing because of the porous nature of government policies and unending labour issues with its attendant bureaucratic bottlenecks. Is it not worrisome that from an all-time high 5,075 megawatts generated capacity, the Transmission Company of Nigeria (TCN) recently confirmed that the power generation level has dropped to an all-time low of 1,580 Mega Watts (MW), thereby dampening hopes of early resolution of the nation’s power supply crisis?
The power generation shortfall, aside from gas pipeline vandalism caused by fellow Nigerians (saboteurs actually) was attributed to the on-going industrial dispute in the nation’s power sector. It is said that staff of National Network Control Centre in Osogbo (where the national grid is operated) went on solidarity strike with their members in Ikeja Disco who failed competency test. In the same manner, other major generating plants in the country, Egbin, Delta, Omotosho and Afam power plants are shutting down. Then one begins to wonder to whose advantage are the protests and strikes? How many are those who are afraid of a Nigeria with a steady power supply?
What Nigerians crave for is an enabling environment that allows them to create wealth. The 2,300 – 4,600 megawatts being currently generated is grossly inadequate to serve over 170 million people, (32 million households) and over a geographical spread of 926, 232km. By average standard, a population of 1 million people requires 1,000 megawatts, so Nigeria requires 170,000 megawatts for 170 million people. The available power should ordinarily only be distributed amongst 4 million electricity consumers constituting 12.5% of the population. An indication we are far from Uhuru. But the Association of Nigerian Electricity Distributors, ANED, has said that with a cost reflective tariff, it will be able to mobilize adequate investment for the power sector. Thus, the onus is on the Federal Government to consistently provide the enabling environment for Foreign Direct Investments and to showcase the vast opportunities in the sector and the Nigerian economy at large to stimulate and generate the desired foreign investment and technological advancement in power generation and distribution.
For some electricity consumers, their crux against the increase is the issue of not having prepaid meters and estimated billing, but the Nigerian Electricity Regulatory Commission (NERC) has come up with a creative alternative which should serve as a reprieve to consumers who can afford to pay for meters. Under the Cash Advance Payment for Metering Initiative (CAPMI) introduced by NERC, consumers who pay for meter under the CAPMI would not pay for electricity if they were not metered in 60 days. “Under the scheme, willing electricity customers are allowed to pay into a dedicated account opened by the electricity distribution companies for purchase and installation of meters 45 days after payment. Such customers are to be refunded their money with interest over a period of time by discounting their monthly bills.” This in my view settles the prepaid meter debacle.
It will be foolhardy to expect steady power supply across the country at the same time or expect that everybody be metered at the same pace. Just like with Nigerian Telecommunications Limited (NITEL) before its privatization, not everybody had NITEL lines; when it was privatized not everybody could afford SIM cards and calls were as high as N50 per minute without the option of per second billing. Up till this moment, there are places in the country that telephone service is still alien to, but we couldn’t have halt collective progress because of them. Today, the story of exorbitant price for SIM cards or making a call is different and people can even afford having 4 SIM cards and 3 phones. That is the purpose of liberalizing the industry. It is an evolving sector, infrastructure provision will be a continuum but Nigerians must set forth at dawn (apologies to Professor Wole Soyinka).
My only challenge with the privatization of the power sector is the elimination of competitiveness, service delivery and customer relations. The general understanding of privatization is to allow for competitiveness but a situation where Abuja Disco or Ikeja Disco controls an entire region without alternatives that consumers can pick from looks absurd. Though not an expert in engineering, one would expect to have alternative services just like in the telecommunication sector, with the freedom to determine who to buy energy from. Either way, Nigerians need to understand the sacrifice to be made in rejigging the economy. With 18 – 24 hours of power supply, one can only imagine the ingenuity of Nigerians that will blossom.
The expenses we make today in fueling generators are against the collar and has been sniffling businesses. Can we not pay a bit more to reduce the frustrating pollution that regularly emanate from generator usage? It is indeed worrisome that Manufacturers under the aegis of Manufacturers Association of Nigeria (MAN) are also protesting the tariff increase without considering the amount expended on diesel and petrol to power their generating sets and how that adds up to their running cost thereby making their finish products expensive. The other day Nigerians, youths in particular went on a bitter philippic attack against the Minister of Power, Works and Housing on social media calling him a failure for not bringing light to our homes forgetting the bitter pill he asked us to take if we want light.
The Minister while responding to a question on what the problem is with power sector, made Nigerians understand that the decision to increase tariff is a bitter pill which he implore Nigerians to take with the hope that the endemic problem will be fixed under his astute watch. Rather than trust the government (even with all its failures), Nigerians chose to dance the macabre dance along with some fat-neck labour unions pretending to be serving the interest of the generality. My experience with some of the come-raids (an euphemism for comrades) have shown that most of their protests are often channeled at making appearances, showmanship, attention-seeking; a means of arm-twisting the government in power to set up a committee that they, the labour leaders will be part of and raking in little finance under the guise of mobilization and serving the interest of the selfish few who do not want Nigeria to develop, in this case, redundant old NEPA staffs, Importers of Generators and the cabals in the oil sector. Nigerians need to stand straight, it is either we do things the old way and remain in darkness or sacrifice to get the urgently needed light.
For me, I chose to follow Fashola’s path to light than NLC/Civil Societies protest of darkness.
Sulaimon Mojeed-Sanni writes from Abuja via email@example.com, he tweets from @OmoMojeed
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