rotimi Ijikanmi">

General news

Increased tariff: Previous administration created problem in power sector

Published

on

The Federal Government has said that the administration of former President Goodluck Jonathan created the problem in the power sector by selling the power generating and distributing companies to incompetent investors.

Information and culture minister Lai Mohammed stated this on Saturday in Lagos at a meeting with the Online Publishers Association of Nigeria.

Mohammed, who was responding to questions on the adjustment in electricity tariff, said that the federal government had spent N1.7 trillion to supplement electricity tariff after the previous government sold and handed over to the investors.

 

He said that the government could no longer afford the cost of the subsidy, especially under the prevailing economic conditions. 

 

The minister noted that the revenues and foreign exchange earnings by the government had fallen by almost 60 per cent due to the downturn in the fortunes of the oil sector. 

“Before we came in, the power sector had been privatised by the previous administration, but the people they sold to them are incompetent.

“When we assumed power, we met the mess.

“Apart from the fact that the Distribution Companies (Discos), could not meter the people, they also could not pay for the electricity generated by the Generation Companies (Gencos), from the Nigerian Bulk Electricity Trading Companies.

“We had two options – cancel the entire sales or to get the Discos to recapitalise.

“We took over the debt of the Discos, which was about N701 billion, because of the effect the cancellation of the sale will have on the country and international investors.

“The people are simply incompetent and if we did not provide the money that means they will not distribute power to anybody,” he said.

The minister noted that the government did not have the resources to continue along the path of subsidising electricity tariff to private companies.

“To borrow just to subsidise generation and distribution, which are both privatised, will be grossly irresponsible,” Mohammed stressed.

To cushion the effects of adjustment of the tariff, the minister said that government was providing incentives to local manufacturers of meters through the Central Bank of Nigeria

He said that companies importing meters would get incentives through tax waivers.

Mohammed added that in order to protect the large majority of Nigerians who could not afford to pay cost-reflective tariffs, only customers with guaranteed minimum of 12 hours of electricity would have their tariffs adjusted.

He said that the industry regulator, Nigerian Electricity Regulatory Commission (NERC), would ensure that those who get less than 12 hours supply experience no increase.

In addressing the complaints about arbitrary estimated billing, he said that mass metering programme was being undertaken to provide meters for over 5 million Nigerians.

The minister said that the government was also taking steps to connect Nigerians not yet connected to electricity at all, to the facility.

“As you are aware, under its Economic Sustainability Plan, the government is providing solar power to 5 million Nigerian households in the next 12 months.

“This alone will produce 250,000 jobs and impact up to 25 million beneficiaries through the installation, thus ensuring that more Nigerians will have access to electricity via a reliable and sustainable solar system,” he said.

The minister assured Nigerians that the service-based electricity tariff adjustment and the ongoing work by German company, Siemens, to boost power supply in Nigeria, would help end the perennial power problem in the country.

According to him, under the three-phase Siemens deal, Nigerians will enjoy 7,000 megawatts of reliable power supply by the end of 2021 ((phase 1), 11,000 megawatts by the end of 2023 (phase 2), and 25,000 megawatts in the third phase.

The minister thanked Nigerians for their understanding, and appealed to them to bear with the government.

Ro

I take my hat off to Hamilton, old foe Rosberg says Real Madrid snatch draw at Borussia Monchengladbach with late Casemiro goal Zapata double allows Atalanta to fight back and share points Sanusi shines as Vieira bags maiden Champions League goal in FC Porto’s victory Felix brace gives Atletico Madrid vital win in UEFA Champions League Fabinho joins Van Dijk on Liverpool’s defensive injury list Guardiola confident Manchester City will find consistency Bayern Munich edge past Lokomotiv Moscow to stretch winning run Manchester City thrash woeful Marseille to stay group leaders in Champions League PMI: Nigeria’s manufacturing sector records growth, says CBN ##ENDSARS Protests: Women group wants urgent answer to youths’ requests Liverpool labour to 2-0 win over Midtjylland COVID-19: NCDC confirms 3 additional deaths, 113 new new infections in Nigeria Protests: Lagos deserves empathy, APC tackles PDP for faulting estimated N1trn for restoration FC Barcelona president resigns, board of directors join in quitting FG to construct 10 new airports — Minister Opposition parties congratulate INEC chairman on his reappointment Lagos Firemen avert another explosion  EndSARS: Group calls for peace, truce between protesting youths, government EndSARS protests: Gov. Ugwuanyi constitutes panel on victims Anambra FA elections: Appeals committee disqualifies Okeke FCT administration to decentralise emergency outbreak response in 6 area councils EndSARS: 2 officers, 1 civilian killed in Ondo — CP FG assures of improvement in oncology practice Protest: Gov. Oyetola says no extension of amnesty for adamant looters I was almost stabbed by Kubwa NYSC Camp looters–DPO Engagements with Nigerian youths transparent, honest–Osinbajo World 100m champion to miss Tokyo Olympics after 2-year ban Buhari nominates Yakubu for second-term as INEC Chairman Enugu State Govt. upgrades Ogbede PHC to General Hospital Amotekun: Gov. Makinde approves recruitment of 1,500 personnel We have no unshared palliatives,Umahi tells Ebonyi residents Banks customers in Benin lament poor services, long queues at ATMs 2021 budget: Delta appropriates over N33.7bn for education, youth, other sectors, says Okowa FIFA President tests positive for COVID-19 NHRC condemns alleged killing of police officers Anambra State FA Elections: Old issues, new crisis #EndSARS: Plateau Lawmakers condemn looting, destruction of Public and Private Properties President Buhari approves digitisation of NFVCB library Gov. Lalong relaxes 24-hour curfew imposed on 2 LGs EndSARS: Minister laments looting of Kaduna NAFDAC Office FG says plans underway for effective transport system for civil servants I will sign executive order to recover looted property — Fintiri Bauchi Govt establishes 17-member panel to investigate Human Rights abuses by security agents AKTH mulls liver transplant – CMD Only 19,600 COVID-19 tests conducted in Oyo – State Epidemiologist FG disburses N6bn to poor households in Zamfara – Minister Gov. Abiodun approves N87.3m counterpart fund payment Buhari mourns Akinyele, ex-Presidential Adviser 4 under-aged, 2 others arraigned over alleged arson in Ekiti