‘Gas price may not affect electricity bill’

 

Electricity generation and distribution firms have said the planned increase in the price of gas supplied to power plants may not lead to a direct rise in electricity tariffs across the country.

According to them, reports of a possible rise in tariff due to gas price increase are not completely true, as they note that series of calculations are involved in the computation of electricity charges.

The current price of gas supplied to power generation companies is $1 per 1,000 standard cubic feet.

This price, according to the Group Managing Director, Nigerian National Petroleum Corporation, NNPC, Mr. Andrew Yakubu, will soon be raised to $1.5 per 1000 SCF.

Yakubu, who spoke in Abuja recently, said the increase was to ensure adequate supply and encourage more gas supplies/sales to power plants.

Following the announcement by the NNPC boss, reports had it that the development could result in an increase in electricity tariff with power producers trying to recover the cost incurred.

But speaking with our correspondent on the issue, the Managing Director and Chief Executive Officer, Geregu Power Plc, Ajaokuta, Mr. Adeyemi Adenuga, said the increase in gas price might not necessarily warrant a direct rise in power tariff.

He said, “I may not be able to answer you in detail because I don’t have the calculations used in arriving at tariffs. It is like a graph and an increase in gas price may or may not have a direct effect on tariffs.

“If the Nigeria Electricity Regulatory Commission or another government agency with expertise in this has said it will not have much impact or that it won’t warrant an increase in tariff; then it is quite possible.