A new twist has been introduced to the planned increase of electricity tariff, as the Lagos Division of the Federal High Court ordered all stakeholders in the electricity industry to maintain current prices pending the determination of a motion challenging the proposed tariff hike.”
Consequent upon this, the presiding judge, Muslim Hassan fixed January 20, 2020 for hearing of the motion on notice.
Justice Hassan gave the order in a suit by the Incorporated Trustees of Human Rights Foundation against 15 respondents in the electricity industry.
Listed as respondents were; Nigeria Electricity Regulatory Commission (NERC); the Bureau of Public Enterprises (BPE); the Nigeria Bulk Electricity Trading Company Plc; and the minister of power.
Also joined in the suit were Abuja, Enugu, Ikeja, Benin, Kano, Port Harcourt, Kaduna, Yola, Eko, Ibadan and Jos electricity distribution companies.
The suit followed the announcement by the NERC January 4 that electricity tariffs being paid by consumers would increase in April this year.
Dissatisfied with the decision, the NGO, in a suit, filed an ex parte motion praying the court to stop the planned over 40 per cent increase in electricity tariff.
The plaintiffs told the court that “the implementation of the purported minor review of the Multi-Year Tariff Order will create unquantifiable hardship and damages on the Nigerian electricity consumers.
“Consumers will be made to pay very high tariff, which has been increased by over 40 per cent across the board of which is currently being billed.”
Their positions were made known in an affidavit deposed to by the group’s lawyer, Mr. Theodora Ubabunike.
It said: “It will amount to a great injustice to impose arbitrary electricity tariff on Nigerian electricity consumers.
“Nigerians will suffer monumental loss as many people will not be able to access power or access same at very high tariff. I know that Nigerians are entitled to access public amenities like electrical power.”
While arguing the application Monday, counsel to the plaintiffs, Anaje Chinedu, asked the court for “an order of interim injunction restraining NERC from taking any step towards the implementation of the purported Minor Review of the Multi-Year Tariff Order 2015 and the Remittance Order 2019,” pending the hearing and determination of the motion on notice filed by the group.
Although the trial judge refused grant the ex parte application, he nonetheless ordered the parties to maintain the status quo.
“The status quo ante bellum shall be maintained by the parties in this suit pending the determination of the motion on notice,” Justice Hassan ruled.
Upon his ruling, the court adjourned till January 20, 2020 for the hearing of the motion on notice.
NERC
But, the NERC has said it has the backing of the law to embark on periodical increase of electricity tariff.
The position was contained in a statement issued by the agency Tuesday in Abuja.
It said: “The Electric Power Sector Reform Act provides that the Commission shall determine and periodically review electricity tariffs charged by the electricity distribution companies (DisCos) and to provide an opportunity for utilities to recover efficient costs of operation and a reasonable return on investment.
“The current tariff methodology adopted by the Commission provides for a determination of a tariff trajectory over a five-year planning horizon and biannual minor tariff reviews taking into account the impact of inflation, rate of foreign exchange, gas prices and energy available to consumers.
“The minor review Order released by the Commission on January 3, 2020 has no immediate impact on end-user tariffs payable by all classes of electricity customers in the country. The order is to establish the impact of the exogenous macroeconomic parameters and costs outside the control of the utilities in the year 2019 and projections for 2020. The macroeconomic indices taken into consideration to conclude this exercise include rate of inflation, foreign exchange, gas price and volume of available electricity. The Order has further prescribed minimum market remittance threshold payable by the eleven electricity distribution companies and the projected tariff path until 2021.
“However, where actual end-user tariffs are likely to be impacted by the review, the required public and stakeholder consultations shall be implemented in line with requirements of the Electric Power Sector Reform Act and Business Rules of the Commission.”
