The recent removal of electricity tariff by the Enugu Electricity Regulatory Commission, EERC, is receiving stiff opposition by the Federal Government.
NATIONAL POST recalls that the EERC earlier in the week announced a reduction of electricity tariff for Band A customers from N209/KWh to N160.
After the announcement by Enugu, Ondo and Lagos states also hinted of plans to review their Multi-Year-Tariff Order.
However, the federal government has said that state governments may not have the capacity to carry the burden of electricity subsidies for Band A electricity consumers.
The Association of Power Generation Companies and the Association of Nigerian Electricity Distributors, in separate statements by their Chief Executive Officers, Sunday Oduntan and Joy Ogaji, have also kicked against the move to slash Band A tariffs.
On his part, Oduntan said Discos are not negotiating with states over the tariff. In his words, "What they are doing will destroy the market," he said on Sunday.
Also, Ogaji said EERC has compounded the problem of the country’s electricity industry.
"It is imperative to state that there is no FGN policy on subsidies. It is debt accumulation," she noted in a statement on Monday.
Reacting to the matter, Bolaji Tunji, the spokesman of the Minister of Power, Adebayo Adelabu, said the federal government will not recommend electricity to states at a time it is battling with a N5.3 trillion legacy to GenCos for the last three years and six months.
"How do they want to manage the subsidy? Do they have the capacity? They have to explain to us because we have to be rational going forward to create a market that will attract investors. We won't recommend a subsidy for band A in states.
"From my analysis, looking at their internally generated revenue and allocations, the states cannot afford it.
“They cannot even pay minimum wage. Even the federal government is finding it almost impossible to bear the burden of the subsidy," he told Daily Post.
Meanwhile, the EERC said on Wednesday that there is no going back on its tariff order.
It also declared that it did not tamper with generation costs, stating that there was no justification to keep the price of electricity for Band A at N209 per kwh.
Meanwhile, electricity customers in Enugu State have been hailing the EERC for the tariff reduction.
They also commended the EERC for freezing other Bands, noting that the categorization was unnecessary.