THE electricity distribution companies (DisCos) have announced an upward review of electricity tariff from July 1. The reason adduced for the increment in the cost of electricity is the current exchange rate of the naira to the dollar or, as the companies put it, “the fluctuating exchange rate.” The previously set exchange rate of N441/$1 had to be revised to approximately N750/$1 with an impact on the tariffs associated with electricity consumption. The companies urged customers with prepaid meters to consider purchasing bulk energy units before the end of the month to “take advantage of the current rates and potentially make savings before the new tariffs come into effect. They estimated that tariffs “are set to jump by 30 to 40 percent in just over a week.”
The increment is coming barely a month after the removal of the subsidy on premium motor spirit, which led to over 300 percent increase in the pump price of petrol, and the increase in the pump price of diesel because of the Value Added Tax (VAT) newly imposed on the product. The devaluation of the naira because of its floating in the foreign exchange market from N441/$1 to N750/$1 has led to inflationary pressures massively reducing the purchasing power of the average Nigerian. Indeed, poverty has deepened with these pressures.
We are amused that these cocktails of purchasing power-eroding policies have been reeled out by the government without a thought about the burden being placed on citizens and their capacity to bear the adverse consequences. The policies have been inflicted on Nigerians as if they are subjects. No policy measures to ameliorate the burden have been contemplated by the government. It seems that the wishes, aspirations and welfare of citizens have been discounted by the government as unworthy of consideration. The government seems poised to continue to inflict belt-tightening measures on citizens while astutely promoting the interest of the DisCos that exploit the masses. Indeed, the Manufacturers Association of Nigeria (MAN) has also described the plan to increase electricity tariffs as outrageous. Manufacturers will ultimately pass on the additional cost of production to the consumers of their products by increasing product prices in the market.
We remind the government that Nigerians as citizens are not conquered subjects to be treated with disdain. They deserve some consideration; their social conditions and living standards should matter to the government. The government must recognise that it exists to cater for the welfare of citizens. Elected officials were given the mandate to rule on this basis. Therefore, the government must be mindful of the consequences of its harsh policies on life and living conditions. The government should not overstretch its luck in the honeymoon period as Nigerians are likely to react to further exploitation in a manner that may involve clashes with it.
The increase in electricity tariff is taking place in an environment where the DisCos have failed to provide regular and reliable supply of electricity. Indeed, these companies have continued to exploit citizens with estimated bills years after the government directed them to provide customers with meters. What is more, they have increased tariff multiple times in the last eight years, from an average of N23.5 kilowatt-hour (kWh) in 2015 to N74 kWh as of June this year. Clearly, in many areas, the government has failed to regulate the behaviour of the companies but has allowed them to continue to pass on big burdens to customers without improving their quality of service. To be sure, the failure to protect customers demonstrates the regulatory capture in the electricity sector. The government has only demonstrated resourcefulness and dexterity in placing burdens on hapless citizens without showing commitment and creativity in making the electricity supply system to work.
It is clear that the government is content to simply use its instruments of policy for the continued exploitation of the people rather than protecting and promoting their welfare. The government needs to show concern about the deteriorating social conditions of citizens and make a commitment to improve their wellbeing. So far, citizens have been at the receiving end of the brutality of government policies. The continued exploitation and misery of the people is such that they are now incapable of adding and absorbing yet another electricity tariff increase without being plunged into abject poverty. Many households have fallen under severe pressure and hopelessness. They need relief instead of the additional burden being placed on them.
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