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Chaos Over Court Order On Electricity Tariff

A recent verdict by Justice Mohammed Idris of the Federal High Court in Lagos nullifying the 45 per cent tariff increase by the Nigeria Electricity Regulatory Com­mission (NERC) has created a chaotic situation, as NERC has indicated its resolve to launch a legal challenge to the ruling.

Last week, the court declared the hike illegal and ordered NERC to immediately reverse its action. Following the verdict, officials of the Nigeria Labor Congress (NLC) on July 15, 2016 held a press briefing in Yaba to applaud the verdict and urge the electricity agency to comply with the ruling.

In his judgment last Wednesday, Justice Idris had ruled that the tariff increment of February 1, 2016 was carried out without following due procedures. The judge declared that the increment should be set aside, describing it as procedurally irregular. He ordered an immediate reversal to the former tariff rate and awarded N50, 000 costs against the NERC.

At a press conference, NLC national president, Ayuba Wabba, urged the regulatory body to reverse the illegal hike in compliance with the rule of law, warning that labor unions would not hesitate to bring the regulatory body before the court if it failed to obey the court’s judgment. Bobbi Kaigama, president of the Trade Union Congress (TUC), cheered the verdict and implored them to hold the regulatory agency accountable to implement the ruling.

However, the NERC has reversed its earlier pledge to abide by the court’s order. The commission later disclosed that it planned to appeal Justice Idris’s judgment. At a press briefing in Abuja on Friday, Tony Akah, NERC’s acting chief executive officer, stated that the commission respected the court’s judgment, but added that the judgment was a setback on the progress made so far in the power sector. He declared that he had instructed the commission’s lawyer to appeal the decision.

“The commission respects this decision of the court, but we are dissatisfied because it represents the reversal of the commercial foundation upon which contracts for gas, hydro, coal and solar feedstock for the production of electricity have been predicated,” Mr. Akah said.

He urged investors in the power sector not to panic or lose trust in the sector. “The commission remains committed to continuously provide the right regulatory framework that would promote private sector investment in the electricity supply industry and also protect the interests of electricity customers as enshrined in the Electric Power Sector Reform Act 2005,” he said at the briefing.