As controversies continue to trail the Federal Government’s recent removal of electricity subsidy for over 1.8million customers
Electricity tariff hike threatens long term viability of businesses- ACCI


categorised to be on Band A feeders, members of the Organised Private Sector has insisted that the hike must suspended for review.


As such, plans are to meet President Bola Tinubu on the matter.



The OPS, including the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture and the Nigeria Employees Consultative Association, disclosed this while reacting to The PUNCH enquiries on Sunday.



Members of the OPS had earlier rejected the tariff hike and called for the suspension of the subsidy removal, saying this would be discussed at the planned meeting with Tinubu soon.



Last week, subsidy on electricity was withdrawn completely from the tariff payable by power consumers in the Band A category, who the Nigerian Electricity Regulatory Commission said constitute about 15 per cent of the total number of power users across the country.



The NERC announced the hike in the electricity bill at a press briefing in Abuja, adding that those affected would now pay a tariff of N225 per kilowatt-hour, up from the previous rate of N68/kWh, representing about 240 per cent increase. The government declared that the decision took effect from Wednesday last week.

They argued that the hike in tariff would send manufacturers out of business, worsen inflation, and stifle small and medium enterprises, stating that no place in Nigeria enjoyed up to 20 hours of power supply daily.



Band A power users are those who get up to 20 hours supply of electricity daily and paid about N68/kWh before the implementation of this latest order.



The Vice Chairman of NERC, Musiliu Oseni, told journalists in Abuja that the government could not sustain subsidy on electricity and had to devise ways to cut down the about N2.9tn that would be spent on power subsidy this year.



He explained that customers on Band A represented 15 per cent of the over 12.82 million registered electricity consumers across the country, adding that the commission had also downgraded some customers on this band.



However, Speaking with The PUNCH on Sunday, the Director-General of Nigeria Employers’ Consultative Association, Mr Adewale-Smatt Oyerinde, said, “The Organised Private Sector of Nigeria is planning to engage the presidency soon to address the issue of electricity tariff hike.”



Also speaking with one of our correspondents on Sunday, the President of NACCIMA, Mr Dele Oye, reiterated the need for stakeholders’ engagement.



Oye said there was no proper preparation by the NERC and the power distribution companies before deployment.



Electricity tariff hike threatens long term viability of businesses- ACCI


The Abuja Chamber of Commerce and Industry (ACCI) has voiced its worries about the recent rise in electricity prices, highlighting potential threats to the long-term viability of businesses.



In a conversation with the News Agency of Nigeria (NAN) in Abuja, ACCI President Mr. Emeka Obegolu expressed concerns that this increase would adversely affect businesses throughout different sectors of the economy.



He noted the existing difficulties entrepreneurs and investors are grappling with and suggested that Small and Medium Enterprises (SMEs), vital to the economic fabric, would suffer considerably due to the increased tariffs.



He stated, “Many enterprises are already struggling with reduced demand, supply chain disruptions, and financial constraints. The burden of higher electricity tariffs exacerbates their challenges and threatens their long-term viability.”

“As advocates for the business community, we urge relevant authorities to reconsider this decision and explore alternative solutions that prioritise the needs of businesses and support ease of doing business.”

“It is vital to strike a balance between ensuring a sustainable energy sector and mitigating the adverse effects of tariff hikes on businesses, particularly during these trying times,”

New tariff will stifle innovation

The president stated that the rise in tariffs would obstruct the ability of businesses to invest in new technologies and growth, and it would affect their competitive edge in local and global markets.



He further mentioned worries that the increased tariffs, along with other economic hurdles like the elimination of fuel subsidies and the consolidation of foreign exchange rates, might exacerbate the challenges encountered by businesses.

https://www.madfind.com.ng/2024/04/ops-takes-power-tariff-hikes-protest-to.html