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Generation Firms Demand Increase in Electricity Tariff

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The Minister of Power, Works and Housing, Babatunde Fashola
  • Generation Firms Demand Increase in Electricity Tariff

Power generation companies in the country have insisted that the Federal Government must increase electricity tariff.

The Vice Chairman, Mainstream Energy Solution, Ismaila Funtua, made the demand in an interview with State House correspondents on the sidelines of the Quarterly Presidential Business Forum held at the Presidential Villa.

Funtua said the representatives of the Gencos had asked for a meeting with the Acting President, Yemi Osinbajo, and the Minister of Finance, Central Bank of Nigeria Governor and the Minister of Power, Works and Housing to sort out issues that were serving as impediments to their business.

He stated, “Whether the government likes it or not, they have to review the tariff of power in this country. All those playing politics with it that they do not want to increase, people do not want to hear of this.

“This is my cell phone, you pay for it even before you make use of it and nobody is controlling their tariff. They charge what they want and all of us we have at least one cell phone, therefore government needs to do the needful.

“If the government wants power, then they cannot continue subsidising for people. You were there when the Minister of Power was saying that people who have ability to pay will pay, but those government needs to subsidise will be subsidised for.”

He added, “Many people are talking about the review of the privatisation of power without knowing where we started from, where we are today, are we owed money or are we not owed money?

“These monies, some of them belong to the banks, some of them belong to us, where are we today? That is why we cannot discuss with the Acting President here in this assembly, we asked for a private meeting where serious decisions can be taken.”

While describing power as very important to economic development of any nation, Funtua said Nigeria could not afford to continue with the present arrangement.

He stated, “The way we are going, we are producing power; government cannot pay because they have no business paying. You are consuming power, you want the government to pay for you. It is not right.

“You are using cell phone, government is not paying for that, you pay for it yourself. We are used to wastage of power, you leave your living room and leave the power on. If you know you are paying the right tariff, you will switch the power off.”

Also calling for tariff hike, the Managing Director, Egbin Power Plc, Kola Adesina, said there were costs that the Gencos incurred in trying to generate electricity and the current structures on ground were not business-friendly since electricity was not political but business inclined.

On the 4,000 Megawatts generation earlier stated by the Minister of Power, Works and Housing, Babatunde Fashola, while speaking at the forum, Adesina said the value chain of electricity had to be dealt with right from the fundamentals, which include gas availability, an end to vandalism, gas supply to the power facilities, while the generating companies must also be ready to receive the gas.

He said, “If evacuation is not impaired, invariably the distribution companies will receive that power into their various transformers and the power can then get to our various homes.

“Essentially, that chain must be enhanced and must be evidence that there is a willingness to do it by each of the segments of the sector; nobody must drop the ball hence, 4,000MW will become achievable.”

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade long experience in the global financial market.

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Economy

Gbajabiamila Says Nigeria Can’t Compete in AfCFTA With Weak Industries

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Nigeria Must Ramp up Industrialisation to Prevent Dumping by Other Nations

The Speaker of the House of Representatives, Femi Gbajabiamila, has said the nation can not compete effectively in the African Continental Free Trade Area (AfCFTA) with weak industrialisation and manufacturing activities.

Gbajabiamila disclosed this while receiving Adesoji Adesugba, the newly appointed Managing Director of the Nigeria Export Processing Zones Authority.

The details of the visit were made public on Thursday in a statement titled, “AFCFTA: House Speaker tasks Nigeria on industrialisation through free trade zones.”

Gbajabiamila was quoted as saying “We must act proactively so that we don’t become a dumping ground for other African nations.

“Our best option in this circumstance is to immediately set machinery in motion to ensure the effective functioning and flourishing of our export processing zones.

“We must remove all bottlenecks and perfect all stumbling blocks. We will then be fully prepared for AfCFTA and also generate massive jobs for our unemployed youths and enhance our foreign earnings.”

He added that the nation must as a matter of national emergency ramp up industrialisation through free trade zones and other effective means to compete with South Africa, Africa’s most industrialised economy and other African nations.

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FG Marches Forward With Zero Subsidy Plan

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FG Says Its Done With Fuel Subsidy After Years of Wasted Resources

The Federal Government through the Ministry of Petroleum Resources said there is no going back on zero-subsidy.

According to a statement released on Thursday by the Minister of State for Petroleum Resources, Timipre Sylva, the Federal Government can no longer bear the burden of petrol subsidy.

In the statement titled ‘Deregulation: The facts and the reasons behind the policy’, the minister said “After a thorough examination of the economics of subsidising PMS for domestic consumption, the Federal Government concluded that it was unrealistic to continue with the burden of subsidising PMS to the tune of trillions of naira every year, more so when this subsidy was benefiting in large part the rich, rather than the poor and ordinary Nigerians,” he said.

Sylva explained that it simply means that the government will not be the sole supplier of petroleum products but will now encourage the private sector to get involved in the business.

“This means also that market forces will henceforth determine the prices at the pump. In line with global best practices, the government will continue to play its traditional role of regulation to ensure that this strategic commodity is not priced arbitrarily by private sector suppliers,” Sylva said.

The minister likened the regulatory function to the role of the Central Bank in the banking sector, “ensuring that commercial banks do not charge arbitrary interest rates”.

Sylva said, “Petroleum products are refined from crude oil. Therefore, the price of crude (the feedstock) for the refining process will affect the price of the refined product.

“When crude oil prices were down, government, through its regulatory functions, ensured that the benefits of lower crude oil prices were enjoyed by Nigerians by ensuring that PMS was lowered. At that time, we indicated that an increase in crude oil prices will also reflect at the pump.”

He said one of the reasons Nigeria has not been able to attract enough investment into the refining industry was because of the burden of fuel subsidy.

Sylva said, “We need to free up that investment space so that what happened in the banking sector, aviation sector and other sectors can happen in the midstream and downstream oil sector.

“We can no longer avoid the inevitable and expect the impossible to continue. There was no time government promised to reduce pump price and keep it permanently low.”

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President Buhari to Sign 2020 Revised Budget Today

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Muhammadu Buhari

Buhari to Sign 2020 Revised Budget Into Law on Friday

President Muhammadu Buhari will sign the 2020 revised budget on Friday, according to the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed.

Ahmed disclosed this on Thursday after a meeting with the leaders of the National Assembly on the 2021-2023 Medium Term Expenditure Framework and Fiscal Strategy Paper.

Ahmed said, “In keeping strictly with the January–December budget cycle, the President will tomorrow (Friday) sign into law, the revised N10.8tn budget for the year 2020, which was passed by the National Assembly in June.

“This for us is a journey towards ensuring that the progress that we have made as a collective to return the fiscal year to January – December is maintained for the 2021 budget as well.

“The President has directed that we must deliver the budget to the National Assembly by the end of September.”

Ahmed further stated that between the months of January and May 2020, the Federal Government generated N1.48 trillion in revenue, 56 percent of its initial target.

She added that out of all the total amount generated as revenue during the period, oil revenues were N701.6 billion while the non-oil tax revenues accounted for N439.32 billion.

Companies Income Tax and Value Added Tax contributed N213.24 billion and N68.09 billion, respectively. The Customs realised N158 billion during the period under review.

She said, “Other revenues amounted to N339.51bn, of which independent revenues was N80.22bn.

“Recoveries and stamp duty collected during the period are yet to be booked in the fiscal accounts.”

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