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The Federal Government yesterday justified its decision to increase electricity tariff in the country.

This is coming even
as President Goodluck Jonathan has directed that the reform agenda in
the power sector should commence immediately.

The Nigerian
Electricity Regulatory Commission (NERC) said last week that the price
of electricity would be raised from the present N8.50k per kilowatt
hour (KWH) next year in line with the schedule in the multi-year tariff
order (MYTO).

Though critics have
queried the plan, considering that the level of electricity generation
and distribution is poor, Nuhu Wya, the minister of state for Power,
told journalists yesterday at a workshop on rural energy supply in
Abuja, that establishing a regime of appropriate pricing for
electricity by the government is one of the ways to remove the barriers
to attracting investors to the nation’s power sector.

“The federal
government is dismantling all barriers that would stop us from running
the power sector as efficiently and as robustly as possible, providing
the enabling environment for everybody to participate,” he said.
“Consumers have to be ready to pay for services rendered. If
electricity is generated for N10, one cannot sell for N6 per kilowatt
hour. If one does, the operator would not be empowered to maintain the
system. The cost of the power we use is far cheaper than the cost of
production.

“I will say that
Nigerians should roll their sleeves and prepare to pay for the
electricity that would energize our economy and make us richer people
and better people. That is why we must review the tariff to reflect the
actual cost of generating and distributing electricity,” he added.

Though the level of
electricity supply may not be as high as would be expected, Mr. Wya
said there is need for the industry to start charging the right price
from the little that it is generating for the consumers. The minister
also argued that when consumers pay the right price for electricity, it
would serve as an incentive for the operators, including the gas
producers and others providing other sources of power, to be attracted
to come in and invest in the sector as well as provide prompt and more
efficient services.

Prospective investors

He hinted that the
ministry has already commenced discussions with some state governments,
particularly those in the Niger Delta region on the prospect of
investing in the nation’s power sector.

The minister
disclosed that steps have been taken to give effect to the presidential
directive on reforms, adding that the review of the price of
electricity in the country is one of the actions aimed at removing the
obstacles to investment in the sector.

“There are so many international investors that want to come and
develop the sector, but because of the unfavourable situation that they
find, they have been discouraged,” he said.