New electricity tariffs: No going back –Fashola By Fred Itua

The Federal Government said yesterday that the National Assembly cannot stop the Nigerian Electricity Regulatory Commission (NERC) from reviewing electricity tariffs, insisting on the new rates.

Minister of Power, Works and Housing, Mr. Babatunde Raji Fashola (SAN), who addressed correspondents after his budget defence, said the NERC was constitutionally empowered to set new tariffs for consumers.

He said the relevant laws backing NERC were passed by the National Assembly. He said: “The law passed by the National Assembly clearly gives NERC the responsibility and power to give a tariff that enables them to recover it investments and returns on it business.

“So, nothing unlawful or illegal has happened. So, I think it was the way it was managed before we came and the review every two years.”

The two chambers of the National Assembly had on Sunday warned NERC to stop the new electricity tariffs,  following a motion passed by the House of Representatives in mid-December, 2015.  The new rates took off on February 1.

Speaking on the importance of government’s strategic partnership with the private sector to generate more electricity, Fashola explained: ‎”People have been hearing for the past 20 years that power projects are over 990 per cent complete. It is absolute nonsense. As far as I am concerned, the ultimate thing is to get it to work.

“One per cent or 99 per cent, we need to get it to work and the best way to get it to work in the interest of Nigerians is to enter into any form of partnership and we will look into that.

“It is not about what I think and I said this much before. Whether we have electricity or not, it is not about what all of us agree we must do. Elecricity is a product. It is made from raw materials. Some of the raw materials are gas, some of the raw materials are power plants and they are also related.

“So, the issue of tariff is the single issue of price. When the raw materials go up, the price cannot stay the same. You may ask why can’t we have more power before the price goes up?

“There are a lot of investors who want to pay a little more than the open market tariff. If we want them to come into the industry, we have to allow the new tariff order which allows for embedded order,” he said.

Culled from The Sun