By Jacinta Hycenth
The Electricity Consumer Protection Advocacy Centre has urged the federal government to conduct a survey to assess the investments made by distribution companies (DisCos) and consumers in electricity infrastructure and maintenance, before a just, fair and balanced cost-reflective tariff can be arrived at.
The Executive Director of the Centre, Chief Princewill Okorie, made this call while lamenting that the operational expenditure (OPEX) and capital expenditure (CAPEX) utilization approved by the Nigerian Electricity Regulatory Commission (NERC) to enable the DisCos to provide and maintain infrastructure are not publicly disclosed to consumers; thereby making consumers often fund and maintain infrastructure themselves, only for the DisCos to take ownership and generate revenue without reimbursing consumers.
Okorie, who also doubles as the National President of the Association for Public Policy Analysis, spoke for electricity consumers at the 5th Annual Conference of the Power Correspondents Association of Nigeria (PCAN) held recently in Abuja, questioning what the DisCos do with the OPEX AND CAPEX approved for them.
He said: “NERC approves Operational Expenditure (OPEX) and Capital Expenditure (CAPEX) to enable the DISCOs provide infrastructure and maintain them. Unfortunately, CAPEX and OPEX approved and given to DISCOs are not made public for consumers to know when and the amount of money given to DISCOs for that purpose. DiSCOs take advantage of this situation to abdicate the responsibility of providing and maintaining infrastructure, thereby raising a question as to what the DISCOs do with the CAPEX and OPEX approved for them. The sad story here is that it is the consumers who pay tariff that still provide and maintain infrastructures, which the DISCOs take over as national critical assets and infrastructure, to make money without refunding the consumers who many a times borrow to provide them and pay back with interest to the banks without being refunded by the Discos who use them to generate revenue. It will amount to exploitation, inhuman treatment and gross injustice against the consumer if this is not considered in addressing cost reflective tariff. A survey should be carried out to identify the investments made by DISCOs and consumers in electricity infrastructure and maintenance before a just, fair and balanced cost-reflective tariff can be arrived at.
“The cost of transformers, poles, cables, feeder pillars, meters etc. which enhances distribution of electricity to end users (Consumers) should be considered as a major component of cost incurred to supply electricity. Are these costs taken care of by the GENCOS, DISCOS, consumers or government? It is expected that DISCOs who are investors should bear the cost of electricity infrastructures and maintenance. Hence, it should be part of the cost to be considered in fixing cost-reflective tariff. If they fail to bear the cost, refund to those who bore the cost should be considered in fixing cost-reflective tariff.”
He also emphasized DisCos’ overbilling of consumers through estimation without adhering to the NERC approved estimated billing cap, thereby making more profit. According to him, corrupt practices as witnessed in the field showed that DisCo staff collected money through their private accounts, thereby making the DisCos lose revenue; Thus, he called for a probe into such practices.
Speaking on both the federal government and international interventions in the power sector, the Executive Director said, “Since commencement of privatization of the power Sector in 2013, the Federal Government has intervened to support DisCos in several ways, irrespective of the fact that they are private sector operators. Among such interventions is the National Mass Metering Programme (NMMP) introduced by NERC and CBN in 2020 for which N200 billion naira was earmarked and N59 billion released to the eleven DISCOs at the zero phase of implementation.
“Evaluation of the implementation of that programme NMMP by the House of Representatives, which I am part of, shows that the process has not been efficient and has been manipulated. In some cases, the meters which were said to be free were sold to consumers and the revenue the meters have generated from vending has been diverted. Yet DisCos are complaining of lack of liquidity. Worst is that different narratives come from NERC, CBN, DisCos and the Fund managers on the project while consumers who are short-changed are still made to pay for the meters without proper account on how it was managed.
‘Similarly, World Bank, GIZ, European Union etc have contributed substantial funds to support the DisCos. Can a transparent and accountable review of the funds be carried out to establish the claims and justification for cost-reflective tariff?”
To ensure customer rights are protected, Okorie called for compliance with the 1999 Constitution of the Federal Republic of Nigeria and the Electricity Act, warning that violation of the provisions of these instruments of governance in the electricity sector as it is being witnessed should not be acceptable to well-meaning Nigerians. He also called for the interventions of United Nations Watch, Global Rights, and the Commonwealth Human Rights Initiative into the plight of Nigerian electricity consumers, stating that protecting their rights should be paramount in any discussions concerning tariffs because it’s the consumers who pay the tariff at the end.
In his welcome address, the Chairman of PCAN, Obas Esiedesa, stressed that the theme “Cost-Reflective Tariff vs. Energy Poverty: Finding a Pricing Balance in Nigeria’s Power Sector” – could not have been more timely as it captures one of the most critical policy dilemmas confronting Nigeria today – how to set tariffs that ensure the financial sustainability of the industry without deepening energy poverty among citizens.
He lamented the challenge of finding a balance decades after privatisation and the sector weighed by an estimated N6 trillion debt owed by the federal government to generation companies (GenCos), that has remained a huge liquidity gap across the value chain, including gas supply shortages, aging and weak transmission infrastructure, and rising foreign exchange costs that threaten investments and operations.
“While operators demand cost-reflective tariffs as a condition for viability, millions of Nigerians continue to live in darkness or rely on expensive self-generation. According to the World Bank, about 85 million Nigerians, roughly 43 percent of our population, still lack access to grid electricity, making Nigeria home to the largest electricity access deficit in the world. This statistic is not just a number; it is a stark reminder of the scale of our national challenge and the urgency of reform.
“At the same time, those who do have access are often confronted with high tariffs, poor service delivery, and estimated billing, leading to frustration and declining public trust. The question before us, therefore, is not whether we need cost-reflective tariffs — we do. The real question is how to achieve a fair, transparent, and socially responsible pricing framework that balances economic sustainability with public welfare.
“As journalists who follow this sector closely, we at PCAN understand that electricity pricing is more than a technical or economic issue — it is at the heart of Nigeria’s development, productivity, and quality of life. That is why this conference continues to serve as a neutral and solutions-driven platform for engagement among all stakeholders,” said the PCAN President.
