The Negative Impact of High Electricity Tariff on Consumers/End-Users in Some Developing Countries

Abstract

The inability to put enabling facilities and technology in place which will enhance the exploitation of available resources (natural gas and hydro potentials) for power generation, transmission and distribution network are due to short-lived plan, age-long corruption, availability of faulty and insufficient components like transformers, bad management, negligence of vital issues, and low electricity tariff. These led to the incessant epileptic power supply in Nigeria. Efforts to maintain a substantial power generation capacity with stable transmission and distribution over a long period in Nigeria led to the deregulation of Nigeria power sector in November 31, 2013, with the idea to allow private organizations to take over some aspects under public private partnership (PPP) agreement. The electricity tariff was increased in the process in order to make the sector attractive to the intended investors prior to the privatization and set platform of realizing every investment made by assuring constant power supply. This is part of the effort towards achievement of the Vision 20/2020 of the Federal Republic of Nigeria. The increased tariff has negative impact on the end-users since there is no significant increase in amount of power supply as promised to compliment the situation rather the existing capacity dropped drastically by more than half of what it used to be and resulted to frequent nationwide load shedding. This paper highlights the negative impact of the increased tariff to consumers and statistically analyzes the electric tariff in general.