Abuja claims still subsidising electricity, Falana plans to challenge scam in court
By Jeph Ajobaju, Chief Copy Editor
Abuja says it is still paying subsidy on electricity even with the recent tariff rise for Band A customers, and despite argument by Femi Falana the government is actually lying about it, and is fleecing the public, because power subsidy had been removed three years ago.
Falana, SAN insisted the government had already removed electricity subsidy three years ago and is now simply scamming consumers to prop of inefficient power operators.
He has threatened to sue to the Bola Tinubu administration to court to stop the fraud.
Regardless, Power Minister Adebayo Adelabu disclosed on Channels Television the treasury has ring-fenced about N1.8 trillion to subside electricity in 2024, but stressed the Electricity Act 2023 makes provisions for tariff review twice a year.
“Review of tariff is actually legal once it is within the exclusive responsibility of the Nigerian Electricity Regulatory Commission (NERC). The Act actually provides for review twice in a year, every six months,” Adelabu said.
“If we have been paying the tariff at the same level in the last two years, it logically means that someone has been paying the burden of all these increases.
“As it is today, looking at a total production, transmission and distribution cost, the Nigerian government is bearing 67 percent of that cost before the increase in tariff for Band A customers.
“But when you look at generation cost, the Nigerian government is paying 90 per cent but in terms of total subsidy, it is about 67 per cent of subsidy on the tariff.
“Last year, it was about N720 billion which was not fully funded, we have about N305 billion carried into this year.
“If we retain tariff at the current level, the Nigerian government will be needing about N2.9 trillion to subsidise electricity but with the increase for Band A customers, we are going to have a reduction of about N1.1 trillion. So, we are looking at about N1.8trn in subsidy.”
The Nigerian Electricity Regulatory Commission (NERC) on April 3 raised tariff for customers classified as Band A who reportedly enjoy 20 hours power supply daily.
They pay N225 per kilowatt hour, up from N66, which has been heavily criticised by many Nigerians, considering the immediacy of the hike and the current hardship in the land.
But Adelabu insisted “the fact that the tariff for Band A, which is 15 per cent of the total consumers, will increase by over 200 per cent does not necessarily translate into 200 per cent increase in their electricity bill if power is properly managed in terms of consumption ….
“The tariff is flexible and I can tell you that even if naira gains more and the exchange rate comes down below N1,000 it must positively affect the tariff and the tariff even for the Band A will come to down below the N225 kilowatt per hour that we are currently charging.”
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Falana laments govt now scams Nigerians to fund Discos as power subsidy already removed 3 years ago
However, Falana alerted the government plans to extend electricity tariff hike beyond Band A consumers to bands under other categories.
Before Adelabu made his latest announcement on April 11, Falana had argued on Channels Television on April 7 that the tariff increase for Band A consumers cannot be justified under the Electricity Ac 2023.
He threatened to take a lawsuit against the hike to seek redress for Nigerians.
He insisted the government had removed electricity subsidy in 2021 and so the new tariff hike is making consumers pay for the inefficiency and profligacy of those managing the electricity sector.
Falana declared electricity subsidy as non-existent and alleged the government is trying to raise funds for cash-strapped power distribution companies (DisCos).
His words: “Under that law, there are certain steps to take and we are going to embark on those steps tomorrow [April 8] which is to raise serious objections with respect to the impunity that has characterised the recent increase.
“At the appropriate time if there is no response, we will have to go to court because the government had warned, the Minister had warned that the increase this time around will only fetch the government or the DisCos N1.6 trillion whereas the destination is N3 trillion.
“So, the poor people that he [the Minister] is talking about, the other bands, very soon, the government is going to extend the increases to them so that the N1.4 trillion the Minister is talking about will be recovered.
“They [the government] are increasing tariff to assist the cash-strapped DisCos, majority of which have now been taken over by the banks and AMCON, and the banks and AMCON have no competence to run electricity companies.”
Falana knocked the government for being insensitive to the plight of Nigerians who are still grappling with the impact of petrol subsidy removal and the collapse of the foreign exchange windows, two policies of Tinubu which have resulted in unprecedented high cost of living.
