I truly do understand the gencos and discos now. They don't want the Band A back into the subsidized B, C, D zones anymore.
Makes sense.
But where did the N4/kwh come from?
Just asking as an ignoramus ooo
From the statement by the Enugu Electricity Board.
“We reviewed their entire costs, using our Tariff Methodology Regulations 2024, and the supporting Distribution Tariff Model to get an average price of N94.
“The price is low because the Federal Government has been subsidising electricity generation cost which charges only N45 out of the actual cost of N112. That was how we came about the average tariff of N94 as cost reflective tariff at our level as a subnational electricity market.
He noted, however, that the N160 Band A tariff could be difficult to sustain should the Federal Government remove the generation tariff subsidy currently being enjoyed by electricity consumers throughout the country, as tariffs would most likely rise beyond these new rates.
naptu2: I always remember this goal anytime I hear the name Andile Dlamini. In the feed that I saw in 2016, you could see her smiling after the ball went in because there was nothing she could do to stop Desire Oparanozie's freekick.
You're someone I read posts and comments from anytime I come here. Awesome mind.
As much as I agree with your submissions 1, 2 and 3, I need to point out that Enugu Electricity Board said they calculated the energy rate and it came down to N4/kwh. It was in a post on nairaland.
Now, their own "silly" belief was that "If you produce at N4, selling at N160 would still make sense".
This is the major part that the gencos and discos need to refute. Or they say "Nothing concerns you with how much we are producing. We can fix any arbitrary price and you pay".
We need to ask the Enugu Board to submit to public scrutiny how they arrived at that figure of N4/kwh.
And like I said, I respect your eclectic mind that seems to balance knowledge in every sector exceptionally well. Awesome.
There are two important things that you need to note about the Enugu claim.
1) They factored in the subsidy that the Federal Government pays. They admitted that the cost was greater than the tariff, but they factored in the subsidy and said that the subsidy should make the tariff less.
2) The Federal Government cannot afford the subsidy. It is owing billions (if not more) in subsidy payments.
FiveFootNinja: Correct me if I'm wrong but has any senior Nigerian team, male or female, ever beaten South Africa in a semi finals and gone ahead to win the finals? I don't think so. 2000 and 2023 AFCON come to mind.
If the answer is no, then hopefully that curse is broken tomorrow.
I actually began to think that it was normal for us to beat South Africa in semi-final and then beat Cameroon in the final of WAFCON.
2016 and 2014.
And there's usually some kind of freekick goal or penalty in the semi-final.
Reference: Just listening to this on radio. I like this squabble. It should motivate states to completely exit the so called 'national greed grid' and seek for the kind of total independence that can spur local development.
A zone like Enugu should be jumping at this opportunity. It has an essential source of energy, coal. All it takes is to fly to the experts in coal to energy, China, a country that powered itself to development reportedly building a new coal fired plant every two weeks at a certain time.
This will be credits and loans worthwhile and foreign investments that will be impactful.
Every zone should the focus on the energy resources in its locality, efficiently generate and distribute at the tariffs it sees fit. Whoever can then provide at the lowest rates will attract the industrial investments.
This has been a subject of massive debate and it's one of the reasons why I talk about the hypocrisy of the West.
There is global warming and everybody is talking about clean energy. Nigeria and other developing countries have been considering using coal to plug their energy gap, but the West put a lot of pressure on them not to do it because they say that coal pollutes the environment.
However, when Germany couldn't get gas from Russia due to the war in Ukraine, they quickly fired up their coal plants and nobody complained.
GloriousGbola: When I first saw the article I misremembered that geometric power plant was located in enugu.
Possibly because imho you can only dictate pricing for power generated in your state. Which will determine who decides to set up plants in your state in future.
I was also wondering how they would recoup their investment seeing as the plant was stalled for over 10 years. How do you roll out a delayed project and then charge under market cost?
It might be technically difficult, but the Federal Government needs to stop subsidising electricity in any state that the state government has taken over regulatory control.
PresidObi: Whatever expenses claimed by the electricity companies that is not shared with us in details cannot be used to determine national costs which the states consumers will be mandated to pay.
You cannot tell me tou are subsidising electricity when we dont know the amount generated or paid for.
The state is right and wants to free other Nigerians.
You don't know the cost and that's not the problem of anybody.
In the original post the Enugu State Government stated the cost which is much higher than the tariff, but it said that FG is paying subsidy, so that's why it is reducing the tariff.
Big news: the FG is owing billions in subsidy payments.
1) Electricity has a cost. Electricity companies must buy gas, pay workers, buy equipmemt, maintain equipment, etc. Payments must reflect that cost otherwise the sector will collapse.
2) The Federal Government is paying subsidy to reduce the cost for users. Users pay less, but the Federal Government pays the difference so that electricity companies can afford to generate power.
3) The Federal Government cannot afford the subsidy. It has been owing electricity companies for a long time. When the companies complain or when service reduces (because the companies cannot afford to generate electricity) the Federal Government will quickly pay part of the debt.
4) Then Enugu State suddenly reduced tariff because it says that Federal Government is paying subsidy (subsidy that the FG is owing o!).
5) NERC has told Enugu that they can't determine tariff for electricity from the national grid. Enugu State Government must pay subsidy if it wants to reduce the tariff or they can build power plants and generate electricity themselves.