HomeIndustry SectorsEnergy EfficiencyTCN calls for cost-reflective tariffs amid grid expansion efforts in Nigeria

TCN calls for cost-reflective tariffs amid grid expansion efforts in Nigeria

The Transmission Company of Nigeria (TCN) has urged the federal government to consider an immediate review of the electricity tariff, which needs to be cost-reflective in order for the power sector to survive.

Usman Gur Mohammed, the managing director and chief executive officer of TCN, advised Nigerians that to fully enjoy the benefits of the liberalisation of the power sector, they must pay cost-reflective electricity tariffs.

He made this statement on 20 February during the ground-breaking replacement of old wires on the Ikeja West-Alimosho-Ogba-Alausa-Ota transmission line.

Mohammed said this would allow the sector to function independently without government intervention.

According to Mohammed, despite the privatisation of the market, in the last six years, more than N1.5 trillion in subsidies had been pumped into the sector by the government. However, remittance from Power Distribution Companies (Discos) are not encouraging.

The TCN executive said Nigeria has the lowest electricity tariff in West Africa.

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However, even though the transmission company has embarked on numerous upgrading exercises of weak transmission lines, these efforts would not translate to sustainable distribution as the Discos are rejecting power because the present tariff structure does not guarantee a return on investment.

Mohammed said, “We have to stop this government intervention [subsidies] and we can only stop it when contracts become effective. Contracts can only be effective when you have cost-reflective tariffs.”

  • Documents submitted by TCN in support of its application for Tariff Review.

Upgrade and expansion of Nigeria’s transmission line network

Speaking on the new replacement transmission lines, Mohammed said it would allow Ikeja Electric to take the full capacity of all the transformers along the substations to be supplied by the lines.

He said, “We are working to transform the TCN to be one of the best transmission companies in the world. But I want to tell the Nigerian public that we cannot move forward if we don’t pay for electricity.”

“I want to tell Nigerians that there is no relationship between poverty and payment for electricity,” he added.

Among the TCN grid expansion plan is to re-conduct Onitsha, Awka, Oji River line to optimise the capacities in Awka and Oji River.

“We are reconducting Ikeja West, Alimosho to Ogba, Ogba to Ota. We are also reconducting Alimosho to Alausa, Kaduna to Zaria, Zaria to Funtua, Funtua to Gwozo, Birin Kebi to Sokoto,” said Mohammed.

He added: “We are also reconducting the line from Aba to Itu and so on. So these are the lines we are going to use these high capacity wires to reconductor them.

“The choice of Ikeja West to kick off the initiative is that the axis has the highest industry concentration in Nigeria and sustainable electricity supply along the route will stimulate economic activities.”

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Nicolette Pombo-van Zyl
Nicolette is the Editor of ESI Africa print journal, ESI-Africa.com and the annual African Power & Energy Elites. She is passionate about placing African countries on the international stage and is driven by the motto "The only way to predict the future is to create it". Join her in creating a sustainable future through articles and multimedia content.