FG can no longer bear electricity tariff shortfalls – Buhari

November 27, 2020

President Buhari has said it is no longer sustainable for the Federal Government to bear the tariff shortfalls in the power sector.

Buhari said this on Thursday, Nov 26, at the inauguration of Eko Electricity Distribution Company’s Supervisory Control and Data Acquisition-Distribution (SCADA) Management System Centre in Lagos.

Buhari, represented by the Minister of Power, Mr Sale Mamman, said the SCADA system would help EKEDC monitor and respond more quickly to faults and reduce outage durations, thereby improving the quality of service to customers.

He added that his regime remains committed to addressing the liquidity challenges adversely affecting the power sector’s viability.

“We have noted with grave concern the increased fiscal burden on the Federal Government occasioned by the tariff shortfalls in the sector which are no longer sustainable,” he said.

He said the Central Bank of Nigeria’s Power Assistance Fund targeted at supporting tariff shortfalls could no longer be extended and must be phased out to promote the sector’s financial independence.

Buhari said, “We are also aware that these tariff shortfalls sit on Discos’ books and impair their ability to raise capital and invest.

“The Federal Government is working assiduously to address these financial and fiscal challenges through various programmes such as the National Mass Metering Programme, the Siemens AG Power Project and the World Bank Distribution Sector Recovery Programme, etc.”

He stressed the need to ensure an alignment of capacity and attraction of investments across the generation, transmission and distribution components of the power sector’s value chain.

The President said the Federal Government, through the Ministry of Power, had inaugurated several projects to address challenges of the critical power infrastructure in the country.

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