Court dismisses manufacturers’ suit challenging electricity tariff hike for Band A customers

A federal high court in Lagos has struck out the case presented by the Manufacturer Association of Nigeria (MAN) against the eleven distribution companies for increasing electricity tariff for Band A customers.

A statement by the Nigerian Electricity Regulatory Commission on Thursday stated that the judgment was delivered on Monday.

In a judgment delivered on October 7, 2024, the court ruled that MAN’s suit was premature and failed to comply with section 51 of the Electricity Act 2023, following its evaluation of the case against the eleven DisCos.

The Court further determined that MAN’s case lacked a reasonable cause of action, as it had not fully utilized the dispute resolution mechanism.

As a result, the Court ruled that the suit was not filed in accordance with due process and subsequently dismissed the case.

MAN’s Lawsuits Against DisCos  

After the electricity tariff for Band A customers increased from N66 to N225 per kilowatt hour, MAN filed a lawsuit against the DisCos.

The association argued that the regulatory procedures for tariff reviews were not properly followed before NERC issued the Supplementary Order on April 3, 2024, and the revised rate on May 6, 2024.

Furthermore, MAN contended that applying the tariff increase solely to Band “A” feeders, while excluding other bands, constituted discrimination against those consumers.

On its part, the Nigerian Electricity Regulatory Commission (NERC) objected to the suit stating that MAN’s case constitutes an abuse of court processes, being hasty and prematurely filed without following due process of the law.

Backstory 

Nairametrics previously reported that the Manufacturers Association of Nigeria (MAN) instructed its members across the country to continue to pay the previous rate of N66/kWh to the distribution companies (DISCOs) pending a resolution of the petition filed by the association to the National Electricity Regulatory Commission (NERC).

MAN claimed that they are being unfairly targeted with high electricity tariffs.

According to the association,  the increase appears to be part of a government strategy to shift the burden of electricity cross-subsidies onto them, a responsibility previously borne by the government before it ceased subsidizing the sector.

What you should know 

In April, the Nigerian Electricity Regulatory Commission (NERC) ordered the immediate upward review of electricity tariffs.

The NERC Vice Chairman, Musiliu Oseni, said only 15% of the electricity consumers are affected by the hike.

Accordingly, he said, power distribution companies (DisCos) will be allowed to raise electricity prices to N225 per kilowatt-hour from N68.

The decision attracted criticism among Nigerians.

Moreover, on 6 May, the distribution companies announced a tariff reduction. Announcing the reduction at the time, the distribution companies said customers in Band A will now pay N206.80/kwh from N225/kwh.