The management of the Abuja Electricity Distribution Company (AEDC) has said that it will effect a new electricity tariff structure from July 1, 2020 as part of measures designed to improve service level performance within its franchise area.
The review, which it said had become overdue even before the outbreak of Covid-19, became necessary in view of radical changes in the macro-economic indicators such as inflation and foreign exchange.
The Managing Director of the company, Mr. Ernest Mupwaya, who spoke on behalf of the company, explained that the new tariff is a total departure from the blanket and across-board tariff structure used in the past in the sector.
He added that the new structure is predicated on the level of service available to customers in different clusters, especially in terms of hours of availability of electricity supply to specific geography within its franchise area.
Christened the Service Reflective Tariff (SRT), AEDC said in the release that five tariff bands had been created and listed the bands as A – E to be implemented in the franchise areas which include the Federal Capital Territory (FCT), Niger, Nassarawa and Kogi.
While band A are customers who have up to 20 hours of supply and above, B is made up of customers who enjoy electricity supply for at least 16 hours, but do so for less that 20 hours daily.
The company stated that C and D are customers who enjoy electricity supply for a minimum of 12 hours, but not up to 16 hours and a minimum of eight hours, but not up to 12 hours respectively, adding that the last band E is for customers who receive electricity for less than eight hours.
Mupwaya explained that while customers within bands A – D will experience a marginal upward adjustment in the cost of electricity, those in band E will have their tariff frozen, that is, will not experience any tariff increase, until the company can show an improvement in the level of service to the customers within the cluster.
“We have structured the new tariff regime in such a way that there can be fairness and equity both to the service provider and the customer.
“Embedded in the new tariff regime is an incentive for the service provider to speedily ramp up performance to 24 hours in all clusters so that it can draw from the benefit of economics of scale associated with numbers, volume and other parameters within its geography,” he said.
The Disco listed its achievements to include being the sector leader in the metering of customers, installation of hi-tech technical equipment, a robust commercial management system as well as a multi-channel customer contact centre.
AEDC said with the commencement of the tariff regime and the support of its valued customers, the company was prepared more than ever before to further raise the bar of performance in the sector.
On what it expects from the customers, Mupwaya said: “The Nigerian power sector has no doubt arrived at a critical juncture as it heads for the point where it can serve as a catalyst for industrial and socio-economic growth and development of the Nigerian nation.
“A critical element in this transformation journey is the role of the customers, which comes in the form of accurate and consistent payment for energy received.
“The electricity value chain — GasCo, GenCo, TCN and DisCo — can only improve where investment and recovery are at par and the investor has the opportunity for a marginal compensation for his investment.”