Power Tariff Reversal Will Threaten Sector Reforms – NERC Boss

The Head/Acting Chief Executive Officer of the Nigerian Electricity Regulatory Commission, Dr. Tony Akah, says the recent court order directing reversal of electricity tariff constitutes serious threat to power reforms in the country.Acting Chief Executive Officer of the agency said if the court verdict is implemented, it will alter the commercial foundation upon which contracts for gas, hydro, coal and solar resources for the production of electricity have been predicated.Akah explained that ultimate destination of a commercialized electricity market is to achieve stability and adequacy in the supply of electricity to satisfy the yearnings of Nigerians for adequate, safe and reliable electricity supply.The court judgment, he added, is a setback to the gains made so far in the nation’s electricity sector.He said: “We are a responsible commission and we respect the judgement of His Lordship. However, we are also entitled to explore other legal avenues allowed within the ambits of the law to challenge that decision. So, for clarity of the position of the commission, we are aware of the judgment delivered on Wednesday, July 13, 2016 at the Federal High Court in Lagos by His Lordship Mohammed Idris. In his judgment, His Lordship declared the electricity tariff regime, which became operational February 1, 2016, as illegal.“The commission respects the decision of the court, but we are dissatisfied because it represents, in our view, the reversal of the commercial foundation upon which contracts for gas, hydro, coal and solar resources for the production of electricity have been predicated.”Akah argued that it also extends to other service improvement contracts that were entered into by operators in the sector for the development of the electricity industry, as well as for the ultimate improvement in the quality of service delivery to consumers.He said: “We have instructed our lawyer to appeal; consequently, the commission has filed for stay of execution and the notice of appeal of the judgement. We believe that ultimately everybody and all institutions will come to a better understanding of the value of the choice we have made as a nation to privatise the power sector.“Therefore, we ask the investors in the sector, as well as customers in the electricity market, not to panic as we seek a resolution within the ambit of the established law of the Federal Republic of Nigeria. The commission remains committed to continuously provide the right regulatory framework that will promote private sector investment in the electricity supply industry and also protect the interest of the electricity customers as enshrined in the Electric Power Sector Reform Act of 2005.”

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