The news of the increase in electricity tariff approved by Nigerian Electricity Regulatory Commission (NERC) filtered in early this week. This news stated that from April 1, 2020, the 11 Electricity Distribution Companies (DisCos) in the country will review their electricity tariff upward.

According to NERC, this upward review, which was last done in 2015, was necessary as a result of four factors – inflation, exchange rate, US rate of inflation and gas prices. These were stated in the agency’s December 2019 Minor Review of Multi Year Tariff Order (“MYTO”) 2015 and Minimum Remittance Order for the Year 2020, which can be accessed from here.

This new increase shows that most tariff plans will increase by the addition of an extra N10 – N25 per unit, depending on the tariff plan and DisCo. However, going through the tables of new rates for different DisCos, I realised that electricity consumers under Enugu Electricity Distribution Company (EEDC) have been paying the new rate for some years now. It is obvious that what we are waiting for is the year 2021 tariff rates and not that of year 2020.

Anyway, the major reason for dropping this article is to lend a voice to many Nigerians, who have one or two things to say to NERC and the Nigerian DisCos.

It is pertinent to note that Nigerians don’t trust NERC and any of the DisCos to provide them with uninterrupted power supply. No Nigerian received the news of the tariff increase with relish. They all expressed their scepticism and suspicion towards the intention of the government agency. A lot of people pointed out the coincidence of the tariff increase and minimum wage implementation, wondering if the federal government is indirectly collecting its money back from the citizens. Then there are those that speculated that the government wants to overtax the citizens so that it will cover up its incompetency.

From the opinions and complaints of Nigerians towards the tariff increase, I noted that three distinct groups exist, all of which require the attention and consideration of NERC and Nigerian DisCos.

GROUP A

Those that belong to this group are the people that are willing to welcome the price hike so long as there is an improvement in power supply. Among these people are business owners that are tired of the high cost of running their businesses with generators. People in this group also complained of the noise and air pollution that comes from power generators. However, they are of the opinion that the only condition in which they will welcome the new electricity tariff is if they will enjoy 24-hour power supply. Failure of this means they will resort to generating their own power through solar, micro-hydro and wind power plants. In fact, a lot of people are considering these business options as I write now.

GROUP B

This group comprises of the people that insist that the tariff shouldn’t be increased for any reason. They hold that the current rate is even too high because a lot of people pay for what they didn’t get. Most of the people under this group are those that are still stuck with the Estimated Bill method and those who do not use electricity for any form of business. According to a person here, he’s billed #12,000 every month even though he couldn’t boast of 5 hours of power supply daily. He couldn’t then imagine what the new bill will cost if NERC is allowed to have its way.

There is something that NERC needs to note about this group. The members are bitter and they feel cheated. They believe that the DisCos in their areas are extorting them. A lot of them claimed to have applied for prepaid meter but have not gotten it because their DisCo benefits more from Estimated Bill method. To this group, increase in electricity tariff rate is a form of corruption.

GROUP C

I met this group in my village, Awkuzu, Oyi Local Government Area, Anambra State; and I believe they exist in every part of the country. When I told some people in my village that “NEPA” was about to increase their tariff rate, I got funny answers that ranged from, “For which light? The one we see or the one we don’t see?” to “They should carry their light; we are used to the darkness.”

This group no longer cares about power supply. They have settled to using generators in running their businesses and they know how to conserve fuel. When their phones’ batteries run down, they take them to business centres where they are fully charged at #50. At home, they use kerosene lamps and rechargeable torches to manage the darkness. Occasionally, when the need arises, they power up their generators do a little “oyinbo”. They heat up their food to keep it “fresh” and they keep their water in cool dark corners to keep it cool. In fact, these people have settled to a lifestyle that ensured that lack of electricity does not disrupt their activities. So when you tell them electricity tariff is about to be increased, they don’t care a bit.

If NERC has considered all factors and deem it fit for the tariff to be increased, no one can stop them. But there is a need to consider consumers’ satisfaction too. The first thing the agency should do is to compel all electricity distribution companies to issue out prepaid meters before April 1. That way, consumers can monitor and manage how they consume power. As for uninterrupted power supply, that is still something in our wish list; we will know when it is about to happen.

NERC and DisCos should also remember that Nigerians are considering alternative sources of power. If they fail to improve, one day they will wake up and find most of their customers are gone.

BUA Cement, on Thursday, listed on the Nigerian Stock Exchange (NSE) with a market capitalization of N1.2 trillion ($3.3 billion) as a result of the merger between BUA Cement, Cement Company of Northern Nigeria (CCNN) and Obu Cement company.

Engr. Yusuf Binji, the managing director of the merged companies, said the merger provided avenues for the companies to solidify their market presence and create a strong bond that will yield value and profit for shareholders. He added that it further strengthens their competitive position in the market and provides opportunity for them to plan and create advance strategies to enhance operations and administrative efficiencies that will spur further growth for the companies.

And the companies are poised to explore new ways to augment its value and market presence.

“BUA Cement is poised to add even more value to the Nigerian economy as a whole through this listing. Over the past few years, we have significantly ramped up capacity and currently boast of the most efficient and integrated operations in the Nigerian Cement Industry. This new publicly listed company will continue to deliver exceptional value to all stakeholders in the foreseeable future,” he said.

He added that the company will incorporate shares from the defunct CCNN and Obu Cement to solidify their market shares.

“We are bringing in about 13 billion shares from the defunct CCNN and 20 billion from Obu Cement and this gives us a total share capacity of about 33 billion shares with a total market capitalization of N1.8 trillion.

“We are coming into the market at the beginning of the year, and since trading has commenced, we expect to see a lot of value added for the shareholders during the course of the year,” he added.

Talking about the production capacity of the company, Mr. Banji said the total installed capacity is eight million metric tonnes per annum. And the companies’ decision to merge is to create a single entity that will leverage on the synergies to generate more profit for shareholders.

“The essence of the merger is to be able to tap into the potentials and unlock the opportunities that are within the two companies in terms of market size, dealership base, profitability and staff skills. There will be a lot of positives as we go along the way,” he said.

This listing has made BUA the third most capitalized stock on the Nigerian Stock Exchange, with 33.86 billion ordinary shares at N35 per share.

The News Agency of Nigeria (NAN) reported that BUA’s listing on Thursday added N1.18 trillion to the NSE market capitalization.

The CEO of NSE, Oscar Onyema, applauded the founder and Chairman of BUA, Abdul Samad Rabiu, for listing the company in the Nigerian Stock Exchange. He said the move demonstrates confidence in the value that NSE offers.

In June 2018, CCNN announced that it has approached the Nigerian Stock Exchange about its intention to merge with BUA. The company was the owner of Kalambaina Cement plant in Sokoto, producing 1.5 million tonnes of cement per annum. On the 6th of January, the company announced that it has received the approval for the merger from the Nigerian Securities and Exchange Commission, as well as the requisite sanction of the Federal High Court of Nigeria.

The deal made Mr. Rabiu $650 million richer and created the second largest cement company on the Nigerian bourse after Dangote Cement.

The process involved transferring all CCNN’s assets, liabilities and undertakings, which includes employees, real properties and intellectual property rights to Obu Cement. In turn, CCNN shareholders will receive shares in Obu Cement and the company will be dissolved without being wound up.

Mr. Rabiu said the merger will enable a wider geographical reach of BUA’s products and increase in production as a result.

“It is anticipated that in addition to meeting the demand of our customers in our core regions in the country, the enlarged company would be positioned to distribute its products in new geographical markets, creating the potential for additional shareholder value creation,” he said.