The governor of the Central Bank of Nigeria (CBN), Sanusi Lamido, yesterday called for the removal of subsidy from electricity, as a means of reviving the power sector.

Mr. Sanusi also said the recent Assets Management Company of Nigeria (AMCON) Act, signed into law by President Goodluck Jonathan, would soon return Nigerian banks to a global stage through a credible balance sheet.

Fielding questions from State House correspondents, Mr. Sanusi said the present N7 unit price was in sharp contrast with global practice, citing the N22 price charged per unit in neighbouring Ghana as an example of modern global reality.

He said that for the power sector to function properly and attract the much needed foreign investment, there must be a regulator that makes it viable. He also called for the immediate revival of the National Electricity Regulatory Commission (NERC) to oversee the moribund sector.

Specifically, the CBN boss stated that the current N7 per a unit of electricity in Nigeria is not competitive enough to bring the country out of its energy demand shortfall, and suggested an immediate increase of over 200% on electricity prices.

“I am saying we’ve got to have a regulator; we’ve got to have good input for gas pricing. It will encourage investment, deregulate electricity prices. This N7 is a myth because nobody gets power at that price.

“Ghana is paying N22. If we increase it to N22 and you increase gas prices, investments will come into power,” he said.

He also said the CBN is “doing what we need to do on the banking system and the banking system is stabilising and with the AMCON, once we recapitalise the banks, it will improve the balance sheets of banks.”

Recovering market

According to him, the capital market is recovering fast and the government continues to make progress as far as the reforms are concerned.

“Having said that, the financial system does not live in isolation. You’ve got to fix the issues of real economy, and the CBN is not responsible for that. You have an economy in which you do not have power. If you don’t have electricity, you cannot attract investors; you cannot improve production.

“We don’t have power because the reforms that ought to have been carried out in four years have not been done. We keep talking and talking and talking, and we have not yet created the right environment and we don’t even have a regulator for power.”

He also called for a removal of subsidy on petroleum products.

“We are spending N500 billion subsidies on petroleum products and nobody will invest in refineries if they believe that their business model is predicated on government subsidy,” he reasoned.

“We are borrowing N500 billion on subsidies every year, we are borrowing money and we are leaving future generation to pay the debt. The benefits of this subsidies are far outweighed by the long term cost to the economy,” he warned.

http://234next.com/csp/cms/sites/Next/Home/5599980-146/sanusi_seeks_200_percent_hike_in.csp

That amount for something that does not exist?

If a country like nigeria cannot sort out its power supply with all the oil money
then they can f.uc.k off.
Nigerian residents (not companies) should try their best to get generators and tell NEPA
to f.uc.k off.
They want to loot the oil money and have the citizens pay to sort out nepa.

nigerians will pay 50Naira per unit if the Light will be there 24/7.

Afterall how much do they already spend on fuel and diesel.

what is wrong with this guy? is he a short man?

Now I know Sanusi is daft!

So he thinks that removal of Subsidy is the solution to electricity problem in Nigeria?

Iranoladun:

Now I know Sanusi is daft!

So he thinks that removal of Subsidy is the solution to electricity problem in Nigeria?

There is a good arguement to back up that. For how long now has the government been subsidising petrol and power? Any improvement so far? There are people making money out of the current subsidy and chaos.

Mr Sanusi, Nigerians will pay way over the required price for a service/good if it is available.

You need not worry yourself what the price of electricity should be. Provide electricity and let Nigerians worry about the charge.

Seemples!

Another style of financial embezzlement coupled wt political propaganda frm ds useless leaders. I'm nt quite suprised abt ds man modus operandi of stabilising economy,ever since he said 'he neva wanted d post of CBN GOVERNOR,what he really wanted 2b his d emir of d so called state he originated from,that his jst using ds as a steppin stone 2 his heart desired post' God help us!

if ill get electricity 24/7 365 days

then we'll pay

any attempt at being epileptic with the supply will be met with stiff resistance

Sanusi has gone nuts, Why compare Ghana to Nigeria? Thats an unforgiveable utterance. Ghana dey produce petroleum Gas, Whats the Population of ghana, has he taken GDP into consideration ? What a Zap ? Aboki. How will you increase the price of something that does not exist, you wanna charge nigerians for electricity that doesnt exist ? Every body tell this aboki Sanusi to supply Electricity first 24hrs before telling us how much to pay. M.u.mu Sanusi aboki

in several conversations with professionals from energy industries, it has always been impressed on me that foreign investors will run at a loss if they are to provide electricity at rates in the current regimen.

we keep hearing about gsm - well the capital outlay of power infrastructure costs far more. in saner climates, returns are spread over decades, but i won't blame investors if they want their returns within 5 years - knowing nigeria and the way change of administration means renneging on former agreements  etal

it is the same issue with gas flaring. oil companies flare gas because the current price regimen by which gas is sold is unrealistic.


of course, we have a catch 22, phcn is incompetent , they give crazy bills, they have generators in their offices, their staff must be settled in order to resolve problesms, customers must pay for procurement of mateerials and workers' transport, so no one is inclined to take any claims of we want more money seriously.

if the phcn command structure and a lot of the underlying structure too - can be sacked outright, i guess we'd go for it.

or maybe if they deployed perpaid metes everywhere first.

tkb417:

if ill get electricity 24/7 365 days

then we'll pay

any attempt at being epileptic with the supply will be met with stiff resistance

Haven't you got a pre paid meter? If you do then that nullifies your position. If people are going to be actually charged for the electricity they use then I don't see the problem. Generating power is not cheap and peopel who are shouting "privatise privatise" should know that if the private sector takes over the prices would (understandably) increase.

^^^ But you will agree that it is "better" to pay a higher price for services fully rendered that paying ALL the time for something you don't even get to see.

i was spending roughly 32k a month on fuel  

i recently got an i pass my neighbour that runs from 12am to 6am in the event theat my inverter is not fully charged to carry me through the night - so happily, my costs are down to 24k

that does not include engine oil, spark plugs, servicing - one of my generators has been refusing to start for the past week , and all the energy put into sourcing for fuel, agidi with inverter ( one has to make sure some items ar sitched off before starting it- or it will immediately trip off) etc

if my current bill was x 10, it would still not come close to my energy costs - though in all honesty, that bil is pure estiamtion


this is the same story of most people in nigeria who can afford to pay for their energy

They cant pay for what is not available
Let them pay for what they see

Here I Pay $134 Last Month Electricity Bill
And I got it Non Stop!!!
Value for Money!

$134 = N20100

my bill last month was probably around 1,700

you are missing the issue. currently phcn , a federal entity is marketing electricity

we are looking at foreign investors coming in to do the same. foreign investors cannot come into nigeria , spend billions of dollars and start retailing power at n17000 per month.

Nigerian's will castigate him, but he's saying the truth!! We must bite the bitter pill before things get better. Govt obviously can't improve the sector and private participation will only come into Nigeria in a deregulated and profitable environment, and N7 is just not profitable!!!
We think about economic policy most times about the short term impact on our pocket, but what about the biliions of $ in FDI and jobs it will provide for people who may never have found work!! If we had no MTN, Zain, Glo, Starcomms, Multilinks, Visaphone etc and only NITEL, where would the people who work there today be working now

The other guy says his bill is $130. Thats N20k+. Fine it's available, but if there is no light can you pay anything, especially if you have prepaid meters? So N22 * 0Kwh= N0, while N7*0Kwh=N0. Meanwhile, generator is roughly N42/Kwh, so doesn't it make sense to substitute N42 with N22 on the assumption that it will even be that expensive here all said and done, given our gas resources and economies of scale!!

Using China as an example,  China is not am oil producing country, they obtain their oil products from countries like Venezuela, Nigeria, Iran and so on, As a living witness, I live in one of the expensive cities. My monthly bill never exceeded 70yuan  convert to naira = 1550 naira despite the fact i used energy consuming appliance especially in extreme winter and in summer and I still enjoy 24 hours electricity. This is a country that import 85% of her resources from other nations,  SOMETHING is really going wrong in Nigeria, generating electricity shouldn't be a problem, some politicians just deliberately pend the nations development because of their greed.

COMPAQ:

Nigerian's will castigate him, but he's saying the truth!! We must bite the bitter pill before things get better. Govt obviously can't improve the sector and private participation will only come into Nigeria in a deregulated and profitable environment, and N7 is just not profitable!!!
We think about economic policy most times about the short term impact on our pocket, but what about the biliions of $ in FDI and jobs it will provide for people who may never have found work!! If we had no MTN, Zain, Glo, Starcomms, Multilinks, Visaphone etc and only NITEL, where would the people who work there today be working now

The other guy says his bill is $130. Thats N20k+. Fine it's available, but if there is no light can you pay anything, especially if you have prepaid meters? So N22 * 0Kwh= N0, while N7*0Kwh=N0. Meanwhile, generator is roughly N42/Kwh, so doesn't it make sense to substitute N42 with N22 on the assumption that it will even be that expensive here all said and done, given our gas resources and economies of scale!!

Don't compare the 2 different countries. On what basis are you doing this?
Plus, increasing the price of anything is not always the solution.

I hate it when people compare countries then go on about currency conversion then how much you'd have to pay for something.
It just does not work that way.

FBS:

^^^ But you will agree that it is "better" to pay a higher price for services fully rendered that paying ALL the time for something you don't even get to see.

Sky Blue:

Haven't you got a pre paid meter? If you do then that nullifies your position. If people are going to be actually charged for the electricity they use then I don't see the problem. Generating power is not cheap and peopel who are shouting "privatise privatise" should know that if the private sector takes over the prices would (understandably) increase.

So what is the wahala again? In that sense wetin consain you consain whether it is 24 hours electricity you get if you only have to pay for what you use?

I agree with you guys that comparison between countries is not very easy to do. But my bone of contention is that the sector should be privatised. Period!!! It will be left to the new companies to determine the prices based on the size of the market, price of gas, overheads etc, but the truth of the matter is that if we are honest we can obviously see that it will get more expensive because we will be almost developing the infrastructure from scratch unlike other countries who have had effective and efficient power infrastructure on ground for decades and for whom economies of scale have set in!! The same happened in telecoms, it was initially N50 per min cos these guys had to build masts, install equipment etc but now its as low as N18 per min( if ur on a contract line) cos these initial fixed costs are now sunk costs. In fact, if not for lack of electricity ( the problem this no electricity is causing ehn) depreciation of the naira and inflation, it would probably have dropped to N10 per min by now!!

i guess this guy wants to imitate his predecessor, i mean maybe he wants to raise enough money as the cbn gov to be able to campign as governor of his state, bunch of thieves who want us to pay for services not rendered. i wonder what this country would be like if we ever have a full month of power supply

Maybe he is trying to say that just like Deregulation the downstream sector when the price is hiked lets say from N7 to N22 it would bring private sector incestments as you all know from economics that the objective of private people is to make MAXIMUM PROFIT and there is an organization PPPRA (petroleum price , regulatory agency) {something close to that 4got the full name and abbv} that fixes price of electricity and if you invest or want to would you like that?No as it wouldnt be attracting to private investors as the price is regulated as if the PPPRA or its government brought the investment which is building power plants so if it is deregulated or hiked  it could bring investors, just like doenstream sector

iz2much:

They cant pay for what is not available
Let them pay for what they see

Here I Pay $134 Last Month Electricity Bill
And I got it Non Stop!!!
Value for Money!

For one month? even if you are a welder. $134=£80 or sumtin. Nah bro itz way too much.

what is frigging wrong with this country? why do we like drawing comparisons with other countries where no similarities exist? now he wants subsidy to be removed as if its going to do any good. World bank and IMF(US) told obj to remove subsidy on agriculture and education. see where that has left us whereas the same america(of course na dem be W'bank and IMF) still dey subsidize agriculture and the likes for their own pple. this is really bad as we are already not getting the value for the bills we pay. abeg lets forget grammah first. give us value for the one we pay

Iranoladun:

Now I know Sanusi is daft!

So he thinks that removal of Subsidy is the solution to electricity problem in Nigeria?

I don't think he is wrong there.

Why not give power first and then, think of how to increase cost.
They have no idea how to make power happen for years, so investment is what will bring power to a nation where no security, no road, no water, no good service, no anything.

Fhemmmy:

Why not give power first and then, think of how to increase cost.
They have no idea how to make power happen for years, so investment is what will bring power to a nation where no security, no road, no water, no good service, no anything.

Considering cost of production, we definitely are at the point that we need investors to invest in power. To get them, we need to create an investor-friendly environment. I believe an increase in cost is inevitable if we truly want 24/7 supply.

wales:


“Ghana is paying N22. If we increase it to N22 and you increase gas prices, investments will come into power,” he said.

http://234next.com/csp/cms/sites/Next/Home/5599980-146/sanusi_seeks_200_percent_hike_in.csp

How can people open their mouth and talk rubbish without being questioned or checked out,
I live in ghana,   A cylinder of gas cost Ghc 9, which is like 900 Naira.
I live in a self contained and pay Ghc 15 a month - which is like 1500 Naira for 24 hours X 30 days.
>>Ask yourself,  1 hour of light a day in lagos and then at the end of the month, you will be paying the same thing I am paying in ghana.
>>Now you know why Nigerians are so gullible. Our leaders know that, that is why they
   enjoy deceiving the masses

what is SOLUDO's business with Light, has he finished sanitaising the banking industry?
is he now an engineer? EWO! wonder shall never end!

thie people just seat up there and make unfriendly policies for the massist!
does every body earn as much as he does?

IS HE PLANNING TO WIPE OUT THE POOR AND AVERAGE?

WHY ARE NIGERIANS SO SELF CENTERED!