The management of Ikeja Electric (IE) has urged the consumers within the zone to embrace a cost reflective tariff so that the company would serve them better.
Engr. Abiodun Ajifowobaje, Chief Executive Officer of company made this appeal during a two day consolation on tariff review with stakeholders and consumers in Lagos.
Ajifowobaje said that the forum was part of what was designed by Nigerian Electricity Regulatory Commission (NERC) as a process to determine new tariff structure for its consumers.
“Instead of NERC to fix the new tariff for electricity consumers, they now Distribution Companies (DISCOs) to consult consumers in the different zones and come back for approval.
“Consequently, we have to consult you on the way forward,” he said.
He said that DISCOs were just like a daily collector, adding that majority of the money paid to them were going to Generating Company (GENCO) and Transmission Company of Nigeria (TCN).
“Of every N100 collected from our consumers, only N15 goes to our pocket.
“We pay N65 to GENCO and TCN will N15 while others like NERC will share N10, so will be left with only N15 out of which we pay our workers salary and replace faulty equipment and others.
“To be honest with you, because we do not have a cost reflective tariff, most of the DISCOs have not even paid the other chain.
“Due to crisis of litigation against the proposed tariff review, we have met with the Vice President, Mr Yemi Osibajo on the isue.
“The Vice President has called on DISCOs to go and negotiate with consumers and come back with good reasons for the tariff review,” he said.
Ajifowobaje urged consumers within the zone to be objective in dealing with the issue, adding that it would be difficult for the company to obtain loan from banks if they do not have cost reflective tariff.
Mr Olurotimi Oduntan, the Director, Association of Nigerian Electricity Distributors (ANED) said that energy was being subsidised by the Federal Government before it was privatised.
Oduntan said that there were lot of gap in the business because they were still operating at the last tariff which was based on exchange rate of N158 per dollar while dollar was around N200 per dollar.
He said that due to the present tariff structure, DISCOs were not making any profit and if things continued this way, the power business might collapse.
The director said that the purpose of the forum was not to increase the present tariff but to open book and go through them together.
The director our consumers within zone to take the advantage of the forum to find way forward so that both the consumers and the investors would be happy.
Also speaking, the Director of Finance, IE, Mr Aigbe Olotu, said that six active members of value chain are being paid money from what they collected at the end of the month.
Olotu said that 90 per cent of what they used to produce electricity supply was in dollar and the Central Bank of Nigeria official rate for power sector had increased to N198 per dollar.
The director said that three factors responsible for the gap in the business include cost of gas, exchange rate and inflation rate.
He said that despite the fact that all these had increased, the tariff remains the same.
Olotu said despite all these, some consumers in communities under the zone were using 28 per cent of their energy illegally.
He said that as result of all these, DISCOs were losing more than N11bn monthly, adding that if these continued, they would run into difficulty.
The director said that all these called for the tariff to be reviewed because there was need to stabilise power in the country.
He agreed with consumers on the elimination of fixed charge but said that the charges would be included in energy consumption by the consumers.
“We have listened to consumers opinion on elimination of fixed charge, but this will be included in your energy consumption.
“At least you will know that if there no power, you will not be charged.
“Everything will be based on energy consumption,” he said.
He, however, assured consumers that if there was a rise in tariff, gradually the tariff would come down as time goes on.
Responding, Mr Ambrose Uche, the Chairman, Ikeja Branch of the Manufacturer Association of Nigeria (MAN) said that it was wrong for MAN to discuss tariff review because the case was in court.
Uche said that tariff discussion was a no go area for them now.
Ms Sola Salako, the Chairman, Consumers Protection Forum, said consumers had suffered in the hands of DISCOs.
Salako said that although the investors were in business to make money, they should balance the equation.
She urged the consumers to face the reality that power was no longer in government ‘s hand.
“As a consumer, you have right to be served electricity and also pay for what you consumed.
“You must understand the service and get accurate information so that you can enjoy the service better.
“But it is wrong for consumers to be paying the company inefficiency.
“As long as some consumers are not paying for energy consumption, consumers that pay monthly bill will always complain,” she said.
Mr Laja Martins, the Chairman, Community Development Committee, Ikorodu said that consumers had a role to play in determining tariff reveiw.
Martins urged consumers to use energy saving bulb to reduce their energy consumption.
He also urged the company to device a system to ensure that change their obsolete transformers and cables.
Also, Mr Joseph Bayonle, the Chairman, CDC Oshodi urged IE to block all the loopholes within the company.
Bayonlr said that they should warn their staff from illegal collection from consumers.
He urged them to go back and perfect their homework before calling for tariff review.
At the end of the consultation, Mr Olanipekun Adeyanju commended the gathering for good conduct during the forum.
Adeyanju assured the gathering that all the facts of the consultation would be presented to NERC in the their next meeting.
NAN
