Senate asks FG to suspend electricity tariff increase

“Our committee needs to investigate the trillions spent in the power sector. That is a lot of money. Try and find out what has happened so far. Government needs to look at this whole thing. Maybe government is not doing its own part. We need to find out. There is lack of capital. We feel very bad. There is no electricity and the country is suffering.”

With these words yesterday, the President of the Senate, Ahmad Lawan, lamented the terribly poor electricity supply in the country despite the privatization of the sector.

Consequently, the lawmakers sought an immediate reversal of the power sector privatization carried out by the last administration for “failure to deliver.”

The Senate also urged the Federal Government to suspend the planned increase in electricity tariff scheduled to take effect from July 1, 2020 so as not to escalate the hardship Nigerians are currently suffering due to the COVID-19 pandemic.

Adopting a motion sponsored by the Chairman of the Senate Committee on Power, Gabriel Suswam, the upper chamber declared that if the privatization in the power sector was not reversed, Nigeria might stop having electricity in the next 10 years.

Lawan, who presided over yesterday’s plenary session said: “We gave power to them (power generation and distribution companies) and they still come to the public to ask for funds. I think it’s time for Nigeria to consider reversing the privatisation of the power sector or they should just cancel the entire privatisation process completely. If we leave it, we may not have power for another ten years.

“We expected efficiency and something better. The distribution companies have no capacity to supply us power. We shouldn’t continue to give them money. They’re private businesses. We need to review this whole thing. Something is wrong.”

The Senate also mandated its committee on power to investigate all Federal Government’s interventions in the power sector since the privatization to date with a view to ascertaining the adequacy of such interventions and their desired impact, and to report back within four weeks.

The committee was charged to investigate all market participants in the power value chain and ascertain the level of corporate governance compliance in the Nigerian Electricity Supply Industry (NESI) and to report back within four weeks. The Central Bank of Nigeria (CBN) was urged to allow operators in the power sector access to foreign exchange for the procurement of equipment and materials as it is done in the aviation and oil industries.

The upper legislative chamber urged the Federal Government to consider additional tariff support to cushion the effect of rate shock over a fixed period to allow time required for the Transmission Company of Nigeria (TCN) and the distribution companies to access funds to implement performance improvement investments that will benefit customers especially during the pandemic.

The lawmakers commended the Federal Government “for the proactive initiative to establish the N1.7trillion COVID-19 Crisis Intervention Fund to cater for issues that are critical to the effective management of the pandemic and to stimulate a gradual return to normal socio-economic activities in the country.”

They urged the Federal Government through the Federal Ministry of Finance to include the power sector in the disbursement of the proposed N500billion COVlD-19 Crisis Intervention Fund in order to ameliorate the financial hazards and operational challenges such as the enumeration of metering of actual consumers and other recent problems caused by the pandemic.

Defending his motion earlier, Suswam said it was alarming that the COVID -19 pandemic had further impacted negatively on the NESI as the Discos reported 50 per cent loss of average monthly revenue collection for the months of March and April.

“If the negative impact of COVID-19 on NESI continues without any emergency financial intervention from the Federal Government, DisCos already facing dwindling revenues in the wake of the pandemic may not be able to meet their remittance obligations to the market as set by the Nigerian Electricity Regulatory Commission (NERC) in December, 2019 Tariff Order. This will also affect the financial obligations of the TCN which is expected to have a cost reflective tariff change of N3.7/kWh to N8.3/kWh by 1st July, 2020,” he declared.

Also yesterday, the Senate urged the Federal Government to as a matter of urgency expedite action towards the completion of the Ajaokuta steel plant.

Adopting another motion sponsored by Yakubu Useni (Kogi Central), the chamber urged the committee on the implementation of the project to ensure that all issues surrounding the operation of Ajaokuta steel projects are resolved.

To strengthen the nation’s economy,the Senate yesterday began an amendment to the Nigerian Oil and Gas Industry Content Development Act 2010 following the consideration of a bill seeking to boost local content.

Sponsored by Teslim Folarin (APC – Oyo Central), the Nigerian Oil and Gas Industry Content Development Bill 2020 scaled second reading on Tuesday.

The lawmaker, in his lead debate on the bill, said it sought to amend 38 sections of the extant Act while introducing six new sections. According to him, the bill will bring the provisions of the sections to be amended into congruence with industry best practices.

Folarin said the bill meant to create a regulatory mechanism to monitor and enforce compliance by industry players
would domesticate a substantial part of oil and gas exploration and production activities within Nigeria.

“You will recall that before this Act came into force in 2019, over ninety percent of the $20 billion spent yearly in the Nigerian oil and gas industry was repatriated abroad.
“This was because a large chunk of the contracts were executed by foreign companies and in foreign facilities. With only few indigenous players and facilities participating in the contracting process in the industry, Nigerian content was less than five percent,” he lamented.

On insecurity in the country, the Senate appealed to President Buhari to expand his recent order of a major military operation to sweep bandits and kidnappers out of Katsina State to include Zamfara, Kaduna, Niger and Sokoto and any other surrounding states where the armed bandits may want to seek a safe haven following the massive operation.

The lawmakers called on the military formations and the Nigeria Police to increase their surveillance to track movements by these armed bandits to prevent them from accessing any safe haven.

The resolutions were sequel to a motion considered on the floor on the need to integrate adjoining states of Niger, Zamfara, Kaduna, Kebbi and Sokoto states in the military onslaught against the bandits

In the motion sponsored by Aliyu Sabi Abdullahi (APC – Niger North), he recalled that the Senate had last week Tuesday considered two separate motions on the need for the Federal Government to immediately address the growing spate of banditry in Niger and Kataina states.

Abdullahi said:”The criminalities by these armed bandits and kidnappers are carried out mostly under the cover of the contagious forests reserves and areas stretching from Katsina, Zamfara, Kaduna and Niger states with pockets of safe havens in Kebbi and Asokoro.

“A major offensive in Katsina State alone is likely to make the armed bandits and kidnappers seek a safer haven in Zamfara, Kaduna and Niger states which host the Zurmi and Kamuku forests, among others, further compounding the plight of hapless and poor communities along these forest corridors.”

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