WED, FEB 26 2020-theG&BJournal- ‘’If you are going to promote efficiency, the only way to promote it certainly cannot be by increasing tariffs. There is absolutely no question about the fact that increasing tariffs will not in itself necessarily promote efficiency,’’ Babatunde Irukera, CEO Federal Competition and Consumer Protection Commission, said Tuesday at the Eko DisCo Public Hearing on Tariff Review in Lagos.
Irukera argued that it is inappropriate for electricity distribution companies to focus on tariff increase as the only way to increase efficiency.
‘’And so the DisCos, including Eko, the starting point is, you must invest. I am not talking about investment in supply or distribution, you must invest in your collection. So long as you have fewer people paying for what most use, you will not find a cost reflective tariff. The answer cannot be burdening those few (who pay their bills) with more.’’
He said that there are a vast majority of bills that are still paid today by estimation, noting that 55 % of consumers are still unmetered.
Irukera recalled that in 2015, the distribution companies came to an understanding with BPE that they would meter more aggressively over the next three years-meter approximately 4.5 million people. That gave an annual target of 1.6 million meters.
‘’As at 2017, only 250,000 meters had been installed. In 2018, 29,850. We are not bridging the meter gap.’’ Irukera reminded stakeholders at the gathering. ‘’How can we find a cost reflective tariff when more than half of your collection is based on estimation or assumption?
Irukera, clearly unimpressed on the very poor meter roll out performance of the DisCos, let his displeasure out.
‘’Ýou have failed in the mutual responsibility that you signed off on to more aggressively meter and provide meters. Not failed marginally, failed woefully,’’ he said.
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