Paying For Nothing

THE Power Holding Company of Nigeria has acquired a reputation for poor services possibly worse than its progenitor, NEPA. Power supply has dipped and the consequences are barely reflected in the statistics about power generation.

Nigerians are groaning under the extra burden of poor power supply. The government has all the right words, none of which has improved the supply of electricity to either industries or homes.

Hospitals are not spared this scourge. There are no studies yet about the deafening and other effects of the noise and effusions from generators that have become fixed items in homes, business and commercial premises. The cost of running and maintaining these drains on the economy runs into billions of Naira annually.

Government has come with one of those tailored measures that have only worked on paper. It wants to increase electricity tariff to improve services. The arguments are the same inane ones government presented for hiking prices of petroleum products.

According to the government, private investors are required to improve power supply. Those investors would not come, if tariffs remain low. Government, therefore, has proposed to increase the tariffs to attract investors.


Nigerians would have to pay for nothing, or at best poor services in the vain hope that investors in the power sectors would rescue them from the swirling scandal of power supply in Nigeria. When would the investors come?

The same positions were applied to supply of petroleum products. Government quickly followed its penchant for higher pricing for petroleum products with issuances of licences to private investors to build refineries. At least 18 licences were handed out. The government said these refineries would meet local demand for the products and leave some for export.

None of these expectations has been met. Only three of the refineries are in any serious state of construction. Others have not proceeded beyond licensing. The argument persists that the price of the products are still too low to attract investors.


Electricity supply may not be different. The decay in infrastructure and a seeming underestimation of the challenges of power supply have left governments making contradictory statements on the energy needs of the country and the diminishing ability of Nigeria to meet those ends.
More annoying is that government can approve price increases for a service that is not available, and which when available is provided in a most unpredictable way.

Why does government not leave investor to market their services to the people at a price the market can support? Could government not have provided incentives other than a higher tariff?
Did the government learn anything from the ineffectual result of this policy when it was applied to petroleum products? Why would government reward the incompetence of Power Holding Company of Nigeria with higher tariff?
Government should reverse the tariff. Let the investors develop the electricity market and make their money. Government should not punish Nigeria with this new tariff.