The Nigerian Electricity Regulatory Commission (NERC) has projected the Energy Cost (EC) for Kano Electricity Distribution Company (KEDC) is to actually rise to N33 per kilowatt hour (kwh) from the previous N22 after validation of it’s operational data.
This was disclosed in a presentation yesterday in Kano by the Senior Manager of Tarrif and Rate, NERC, Hajia Aisha Mahmud at a stakeholders’ workshop.
Hajia Mahmud said, the absence of a non cost reflective tariff in the Multi Year Tarrif Order (MYTO II) resulted in the review of Distribution Companies (Discos) Aggregate Technical, Commercial and Collection (ATC&C) and Customer Number Enumeration to address the issue.
Meanwhile, the Chairman, NERC, Dr Sam Amadi in his address said, “We are obliged by the law of this country to ensure that the cost that is paid as tariff is reflective of the cost of electricity that is consumed.”
Amadi who was represented by the Commissioner for Market Competitions and Rate, Eyo Ekpo said the best way to balance electricity cost for both consumers and operators is on reviewing the ATC&C and to ensure that it reduces significantly in the next five years.
NERC which based it’s review on data earlier submitted by the 11 Discos and verified by an independent team said KEDC has 48% ATC&C as against the previous 40%, which is expected to reduce to 16% in 5 years.
However results for Yola Disco indicated a hike in tariff increase with high ATC&C of 57%, to reduce to 25% in five years. A such, while high billing was noted, a corresponding high non bill payment was also observed for the Disco.
The increased ATC&C for the Discos further indicated a rise in tariff which could come after the MYTO Minor Review by December. But NERC said it is considering an option of financing losses differences from the $213bn CBN Fund which will stall any tariff increase for the next 12months.