Nigeria Spends Over $131m Monthly On Electricity Subsidy, Power Minister Says
The federal government of Nigeria says it is still paying over $131.14million in electricity tariff subsidy, despite the recent hike in prices paid for power by Nigerians and incessant complaints by consumers over periodic increases.
Describing the raise in the tariffs as “unavoidable”, the government explained that the funds are provided to augment the shortfall by the Distribution Companies (Discos) which it argued have failed to defray the cost of bulk electricity supplied to them by the Generating Companies (Gencos).
Speaking when he received members of the Hausa Guild of Actors and Film Producers, otherwise known as Kannywood, the Minister of Power, Mr. Sale Mamman, however stated that following a minor increase in the tariff, the subsidy had decreased, but still constitutes a serious drain on the nation’s coffers.
A statement by the Special Adviser, Media and Communications to the minister, Mr. Aaron Artimas, said that Mamman expressed serious concern over the failure of the Discos to stabilise their operations to meet their financial obligations to other players in the sector.
The minister also argued that the power sector was in its present state because when it was being privatised, the distribution assets were sold to government officials and their cronies.
“Most of the Discos were sold off and managed as family businesses, which had made them difficult to be professionally managed, but despite this apparent difficulty the government cannot roll back the privatisation process,” he stated.
He asked the Discos to stop burdening Nigerians by asking them to pay for transformers, electric poles and cables, saying that it was the responsibility of the power distribution companies to do.
According to the minister, it was in response to the lethargic performance of the Discos that the federal government has been forced to partly subsidise the sector so as not to price the cost of electricity out of the reach of the ordinary Nigerian.
Mamman explained that as part of the measures to assist ordinary Nigerians over their frustration in receiving adequate electricity supply, the federal government was forced to categorise electricity supply into various bands between highbrow areas and low income earners to enable everyone cope with the cost of electricity.
“Nigerians must understand that these companies were privatised long before the advent of this administration but the government has no alternative than to continue managing the sector before a final solution is secured,” he added.
He pointed out that through the Presidential Power Initiative (PPI) and other intervention measures, the government was diligently working to massively resolve all these inherited problems that have continuously frustrated the success of the sector.
Mamman stated that while some of the problems still persist, remarkable performance and progress had been achieved by the federal government, as the supply of electricity has stabilised at over 5,000 Megawatts, up from less than 4,000 Megawatts before President Muhammadu Buhari came to power.
He insisted that it was the responsibility of the Discos to replace faulty transformers, electricity poles and cables whenever they occur and warned them to stop tasking ordinary Nigerians with the responsibilities before they could restore power after interruptions.
On metering, Mamman explained that although it was the responsibility of the Discos to provide meters, the federal government has intervened in view of the public outcry over estimated billings.
He said the federal government was committed to supplying over six million meters free of charge to Nigerians, adding that about one million meters had already been delivered for distribution while the rest were being awaited.
The minister called on the Discos to expedite the distribution of meters free of charge to their consumers as a way of lessening their problems.
Earlier, the leader of the Kannywood delegation, Mandawari Ibrahim, said they had decided to avail their services to the ministry of power so as to adequately enlighten Nigerians on the “achievements” of the Buhari’s administration under the power sector.
