Power Subsidy …FG Approves N177bn

The Administrator of the Nigerian Electricity Regulatory Commission (NERC), Dr Imamudeen Talba,  has said the Federal Government has approved N177 billion as subsidy for power consumption.

Talba disclosed this, yesterday, in Abuja at a stakeholders workshop on Annual Review of the Multi Year Tariff Order (MYTO).

He said the gesture, which is for a period of three years, was aimed at shielding consumers from exorbitant rate which could follow the regulation.

It would be recalled that MYTO was established in 2008 to reposition the electricity industry by providing an appropriate tariff acceptable to electricity consumers and operators.

Talba said that following the subsidy approval, the Federal Government had released a total of N43.9 billion for disbursement to beneficiaries which included distribution and transmission companies.

He said that in spite of the reviewed N11.20k per KWH , electricity consumption will still remain at N7 per KWH“ following government’s resolve to pay off the balance through the subsidy”.

“However , based on a number of concerns by the commission and stakeholders on the subsidy so far released, we have appointed a firm of auditors to review the disbursement process to ensure transparency and accountability”, he said.

Talba said the last MYTO review reflected significant changes “in the underlying parameters of inflation, exchange rate and gas price”.

He said that the process was usually carried out in line with present economic realities.

He said NERC had “negotiated an increase in gas supply to the sector with the NNPC and agreed on an increase in gas price by the end of the year if the increase in supply is sustained”.

According to him, with this development, “our gas powered stations can have improved feed stock for improvement in generation’’.

Dr Haliru Dikko, NERC’s Head of Market Competition and Rates Division, in his remarks, said the commission would soon embark on a five-year major review of MYTO.

He said the review would, among other issues, address capital expenditure for transmission and distribution companies.

Dikko said that the review would also look at the level of performance of distribution companies in relation to actual and projected sales, operating costs, taxes and other payments.

Participants at the workshop were drawn from the power ministry, and its agencies, independent power producers, electricity consumers, and the media.