AEDC Targets 35 Percent Average Tariff Hike, N43 Billion Investments For Sustainable Power

Abuja Electricity Distribution Company (AEDC) has proposed average hike of tariff by 35 percent which it explained will make electricity supply sustainable and attractive for investments.

The Managing Director and Chief Executive Officer of the AEDC, Ernest Mupwaya, disclosed this while making presentation on New Electricity tariff set to commence nationwide by the Nigeria Electricity Regulatory Commission (NERC), effective April 1, 2020

The presentation was made during interactive session between the AEDC Executive Management Team and Media held in Abuja.

He said however, that in absence of introduction of new tariff by the AEDC, the company will require to source investments of up to N43 billion to enable it reach a level of up to 24 hours power supply sustainability in its franchise areas of Abuja, Kogi, Nasarawa and Niger States.

He justified increase in tariff saying that it makes the sector attractive to investors, removes government subsidy which is not sustainable, ensures improvement of the sector facilities, guarantees steady power supply, boosts economic activities which in turn improves the wellbeing of the people.

On investments and metering projects, Mupwaya said AEDC has total meter installation of 160, 832 meters and acquired 205 broadband vehicles. Also, installed Network capacity of about 710 MW peak power and replaced and installed 630 faulty and reinforcement distribution transformers.

While explaining generation, administrative and distribution tariffs, he said, out of 100% expected revenue from customers, 60% goes to gas suppliers and generation companies, 15% goes to TCN, System Market Operator and NBET, while 25% goes to DisCos.

He listed delay in government intervention to address sector gaps, Non-payment of Ministries, Departments and Angencies (MDAs) bills, Non-cost reflective tariff, harassment of Disco staff by some MDAs (Barracks), increase generation costs without corresponding increase in retail tariffs, insufficient energy generated and wholesale vs MYTO projected as some of the challenges being faced by the company.