AEDC debunks increase in electricity tariff
By Akinyemi Precious
The Abuja Electricity Distribution Company (AEDC) has clarified that it has not raised electricity tariffs, contrary to media reports.
Reports surfaced on some media platforms that AEDC had announced an impending tariff increase despite not being approved by the regulator, NERC.
This announcement also comes amidst predictions from energy experts that electricity tariffs are expected to increase due to the managed float by the Central Bank of Nigeria (CBN) and the austerity measures implemented by the administration of President Bola Tinubu.
However,AEDC emphasized that no approval has been granted for tariff increments and urged customers to disregard any notifications suggesting otherwise.
They stated, “Please ignore the information circulating in the media about the review of electricity tariffs. We want to inform you that we have not received any approval for such increases, and we apologize for any inconvenience caused.”
They made it known that Major changes are not due til December as electricity prices in Nigeria are anticipated to rise following the unification of the naira, which has led to its depreciation at the investor and exporter window. The CBN recently announced the consolidation of all segments of Nigeria’s foreign exchange market into one.
A Director of Energy Markets and Rates Consultants, Dr Damilola Oluwole explained that current electricity tariffs have already factored in the inflation rate.
He said that the inflation rates used are based on historical average rates from the National Bureau of Statistics (NBS), with the current figure standing at approximately 22.4 per cent. Consequently, due to a slight increase in the Consumer Price Index (CPI), the impact of tariffs is expected to be minimal.
Furthermore, he mentioned that according to figures provided by the CBN’s website, the exchange rate of USD/NGN 467.53 indicates a marginal increase compared to the current rate of USD/NGN 441.48.
“If we assume that the rate of USD/NGN 663 from the I&E window on Friday, June 16th, is used for December 2023 tariffs, and all other factors remain constant, we can expect an average increase of about 25-30 per cent for some distribution companies (DisCos).” he said.
Meanwhile, the Nigeria Labour Congress (NLC) has demanded that the Federal Government halt the proposed 40 per cent increase in electricity tariffs, scheduled for July 1, 2023.
The NLC expressed its concerns about its impact on consumers, particularly those who are financially disadvantaged and also raises concerns about inadequate service delivery, covert tariff increases, and the potential hardships faced by ordinary Nigerians as other entities adjust their prices or rates.
