Nigeria labour unions picket DISCOs, NERC over electricity tariff hike

Members of the Nigeria Labour Congress and Trade Union Congress have staged a protest against Ikeja Electric and Ibadan Disco in response to the recent electricity tariff increase for Band A consumers. The unions are demanding a complete reversal of the tariff adjustment. Ayodele Oni, a Partner at Bloomfield Law Practice, shared insights on the situation in a recent interview on CNBC Africa. Oni acknowledged the grievances of the unions and consumers but also highlighted the complexities and challenges within Nigeria's power sector. He mentioned that the cost of generating power must be passed on to consumers and raised valid questions about the efficiency of the system. Comparisons were made with other countries like Canada and Germany where electricity prices differ significantly. Oni explained that inefficiencies within the Nigerian system contribute to the high costs. He suggested that addressing these inefficiencies could lead to a reduction in prices, but emphasized that electricity would never be cheap due to the nature of the industry. The discussion also touched on the impacts of removing subsidies on electricity prices and the potential economic implications of reversing the current tariff hike. Oni pointed out that improving the efficiency of the system, utilizing a mix of power sources, and addressing cost components such as CAPEX and OPEX could eventually lead to more affordable electricity prices. While acknowledging the emotions involved in such protests, Oni stressed the importance of considering facts and improving the system to avoid continually paying for inefficiencies. The dialogue between the labor unions, government, and industry stakeholders continues to be crucial in addressing the challenges in the electricity sector. As the situation evolves, finding a balance between cost recovery, efficiency, and consumer affordability remains a key focus.