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Published On: Thu, Mar 12th, 2020

TCN fails to justify tariff hike request at NERC Public Hearing

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By Etuka Sunday

The Nigerian Electricity Regulatory Commission, NERC, public hearing on electricity tariff review proposed by the Transmission Company of Nigeria, TCN, yesterday, ended abruptly as the TCN failed to provide sufficient information to justify its request for approval of new rate.
The Extra Ordinary Tariff Review, according to the company was aimed to effect electricity tariff increase against what Nigerians are currently paying in order to procure spinning reserve to regulate generation frequency.
But the company was unable to provide tangible argument and information as to why the electricity consumers should be made to pay for what is entirely in the region of power generation and transmission.
The public hearing scheduled to acquaint stakeholders and electricity consumers with comprehensive reasons why the regulatory agency should consider the request by the transmission company.
TCN, represented by Head, Market Operator, Mr Edmond Eje, told the three-member NERC panel headed by Vice Chairman, NERC, Mr Sanusi Garba that all the details were already with the regulatory agency, stressing that there was no need to rehash them.
But Mr Garba, reminded TCN that the hearing was in line with the business rules of the commission in relevant portions of the act setting it up, which requires the transmission company to present its case to the panel of three and some conveners to interrogate the submission of TCN whether they deserved the hike in tariff or not.
Garba said, “Our opinion is that the presentation has not displayed any justification why the hike should be effected.
“The focus should be more about why you want an increase. Because whatever we approve as a commission is going to be paid by somebody else, the consumer.
“That is why the stakeholders are asking why this needs to be done. We were expecting a comprehensive presentation of what you want and why you want it.
“I think we have got to a point to decide whether to proceed with this hearing. The point is whatever rates are approved, consumers are going to pay, the point of this sitting is to justify to the public why the rates should be approved.
“There’s nothing that’s classified in this business. Everything is open. Whatever you have, you are to present it. Put everything out for everyone to hear.”
Mr. Ejeh earlier, said the operator was of the view that what was proposed as the tariff was not good enough to provide the quality of service and as a result needed a review.
He said, “They, NERC, told us to go for due diligence and we did and we settled for 260 megawatts and after the conditions required, we came out with an equivalent demand of 3.6 billion per month.
“The regulator didn’t look at it kindly. They said it will be too difficult to do the spinning reserve.”
He argued that the details were not for public consumption since they were already with the commission, a point which was countered by the panel chair, who noted that there’s no secrecy in the operation of the commission and the entire electricity sector.

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