Thoughts on the new electricity tariffs.

From today, Nigerians will pay more for electricity – when and where available – but this is not the full story. Tariffs will go up every year till 2016, as part of the Multi Year Tariff Order (MYTO). The rationale for this, is so that tariffs become more ‘cost reflective’ of what it takes to produce the electricity, thereby attracting investors.

On the face of it this is a good argument, except that there is little or no electricity to start with. For the mean time, Nigerians will be paying more for darkness.

I do not think the government should set prices. The priority should be to complete the privatisation of the PHCN, and allow investors to come in and set their prices, while guaranteeing electricity. Obasanjo managed to do this with the telecommunications industry which has led to the benefits we have enjoyed over the last ten years, benefits which are being obstructed, once more, by our government.

For 50 years, we have been unable to generate the power needed to drive economic growth, and tariff increases will not solve this. A government that cannot generate adequate electricity should not set the prices for it. Let those who can, do so.

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