The capped tariff system introduced by industry watchdog, Nigerian Electricity Regulatory Commission (NERC), into electricity pricing cost them N13.9 billion in revenue loss every month, Power distribution companies (Discos) said on Thursday.
This was revealed after the Discos requested realistic indices before the execution of a new value-reflective tariff regime earlier timed to kick off on 1st July.
According to reports, NERC had in late June postponed the proposed tariff hike to the first quarter 0f 2020, citing the outrageous size of Nigeria’s unmetered population (60%), which it said was a “major impediment to both an immediate tariff review and revenue protection of DisCos,” among other grounds.
Ernest Mupwaya, Managing Director Abuja Electricity Distribution Company stated this while making a presentation on behalf of power distributors at a public hearing arranged by the House of Representatives Committee on Power that a number of hitches must be addressed before the new tariff teed off.
“One of them is the removal of estimated billing caps. The financial impact of the Capping Order is an average loss of N13.9bn monthly, thereby, undermining or jeopardising the minimum remittance requirement.”