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CCPE hightlights urgency in addressing electricity value chain challenges

The Center for the Promotion of Private Enterprises (CPPE) has emphasised the need to address some fundamental issues in the electricity value chain.

Its founder, Dr. Muda Yusuf, gave the advice on Wednesday in Lagos in reaction to reports of an electricity tariff increment for Band A consumers by the Nigerian Electricity Regulatory Commission (NERC).

 

The News Agency of Nigeria (NAN) reports that the commission’s Vice Chairman, Mr. Musliu Oseni, on Wednesday announced an adjustment in tariff, resulting in Band A customers paying N225 per kilowatt-hour.

The development translates to a 241 percent increase from the previous rate of N66 per kilowatt-hour for the 15 percent of electricity consumers affected.

Yusuf noted that issues of technical and commercial losses were yet to be addressed.

Additionally, he stated that matters of inefficient costs that consumers were compelled or expected to pay for as part of the cost recovery argument were pending.

According to him, these costs run into billions of naira.

“There is also the exploitative practice of estimated billing, as millions of electricity consumers are yet to be metered.

“There is the problem of overcentralization of the power supply through the national grid model.

“There are capacity issues with some of the electricity distribution companies, contributing to the lapses in electricity delivery outcomes.

“The energy mix programme is yet to gain impressive traction. Hence, it is important to fix these fundamental issues in the power sector.

“Fiscal policy measures should be immediately deployed to reduce costs across the entire electricity value chain,” he said.

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Yusuf noted that, while the power sector issue had become a major conundrum in the economy and a tariff review was inevitable, an almost 300 percent increase in one fell swoop was difficult to justify.

He, however, stated that the increase targeted at only 15 percent of electricity consumers with the highest ability to pay would reflect some attributes of equity in pricing.(NAN)

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