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The Chief Executive Officer of Century Power Generation Limited, Dr Chukwueloka Umeh, says that Nigerian Electricity Regulatory Commission’s (NERC’s)failure to increase electricity tariff in smaller steady steps from 2015 as stipulated in the Multi-Year Tariff Order (MYTO) has made the almost 100% increase for some consumers in September 2020 very discomforting, especially at this time of unprecedented economic hardship.
Dr Umeh said that for there to be electricity available to every Nigerian, a tariff increment is necessary for the power value chain to work effectively. He, however, admits that timing for this increase is could be better considering the economic situation in the country.
Speaking as a guest on a television program in Lagos on Wednesday, January 6, 2021, he reasserted that the government’s role in the power sector needs to be solely that of an enabler that provides a conducive investment climate for investors, as well as a regulator that oversees the operation of the industry.
Dr Umeh, also the Chief Operating Officer (COO) of the Nestoil Group, held that an increase in the tariff to a cost-reflective level is necessitated by the need for the DisCos to upgrade and maintain their infrastructure, provide the service that people expect, and also make a profit from the power they sell. They also need to generate enough revenue for the other companies in the value chain, including TCN, the GenCos, and the gas suppliers and transporters to get paid. If these investments and payments are not made, people won’t get the power they’re required to pay for.
For electricity to be available, he said, the government needs to create policies that encourage investment, ensure that contracts are respected and are backed by the rule of law. He emphasizes the private sector should be allowed to drive the entire power value chain, competition should be encouraged to grow and drive the right tariff pricing. Finally, the government should desist from trying to regulate a market into existence, but rather, relax regulations enough to allow the sector to grow organically.
According to him, most of the public and even some pertinent persons in government are not sufficiently informed about the power sector, hence the lack of understanding that without a functioning value chain involving gas producers and transporters, GenCos, TCN, and DisCos, most Nigerians will regrettably continue to pay for darkness.
Century Power Generation (CPG) is an indigenous company involved in developing and implementing solutions to Nigeria’s local power problems. Dr Umeh continues to lead advocacy for a robust, stable and reliable power sector as the most reliable pathway to catalyzing Nigeria’s economic growth.