Electricity Tariff: NERC Appeals Judgment of Lagos Court

NERCThe Nigerian Electricity Regulatory Commission (NERC) has appealed against the judgement of a Federal High Court sitting in Lagos which declared as illegal the electricity tariff currently used in Nigeria by the 11 electricity distribution companies.

Acting Executive Secretary of the commission, Anthony Akan, described the ruling as a major setback on the progress made in the country’s electricity sector.

He added that while the commission respects the decision of the court, it would appeal the judgement because it represents a reversal of the commercial foundation on which power supply contracts in the sector were built.

Mr Akah said that the commission was dissatisfied with the judgement because it impinges on the ultimate destination of the power sector as a commercialized electricity market.

He explained, “The ultimate destination of a commercialized electricity market is to achieve stability and adequacy in the supply of electricity to satisfy the yearning of Nigerians for adequate, safe and reliable electricity supply.”

According to him, the multi-year tariff order which the judgement effected provides a long term path of determining in advance, what the tariff will look like and based on that a lot of improvement in the sector were recorded and are in progress.

The Judgment

Justice Mohammed Idris, who delivered judgment in a suit filed by a Lagos based lawyer, Mr. Toluwani Adebiyi, challenging the increment, described NERC’s action as irrational, irregular and illegal.

The court, while relying on Sections 31, 32 and 76 of the Electricity Power Sector Reform Act (EPSRA) 2005, in deciding the substantive suit, held that, “NERC acted outside the powers conferred on it by the Act and failed to follow the prescribed procedure.

The court was also of the view that “NERC has not shown that it acted in due obedience to the prescribed procedures and that there is no evidence that NERC complied with Section 76(6)(7) and (9) of the EPSRA Act.

The court further held that “of all the legal requirements, it appeared the only one complied with by NERC was that it announced the new tariff in the newspapers.

The court said that, “it is clear from the affidavit evidence that the increase in tarriff was done by NERC in defiance of the order of the court made on May 28, 2015 which directed parties in the case to maintain the status quo”.

On this issue, the court said, “the law is that every person upon whom an order is made by a court of competent jurisdiction must obey it, unless and until the order is discharged and set aside at the Appeal.

Consequently, the court held that,” the tariff increase from July 1, 2015 was done in breach of the ‘status quo’ order”, adding that “NERC’s action, was therefore, clearly hasty, reckless and irresponsible”.

Speaking further, Justice Idris said, “this country is in a democracy where the rule of law shall prevail over impunity or whimsical desires. Anything to the contrary will be an invitation to anarchy.

“It is the law that what is done officially must be done in accordance with the law. Investors are free to do business in Nigeria but they shall abide by the law of this country. Nigeria is not a kangaroo State. Nigeria is not a banana Republic.

“It is intolerance and extremely dangerous for any branch of the Executive to create a posture it may not obey certain orders of the court. That is tantamount to Executive recklessness which will lead to lawlessness”, he said.

In view of these, the court while invoking its disciplinary jurisdiction, ordered that “the increment in electricity tariff which took effect after the institution of this action and while a restraining order is subsisting is hereby declared illegal and same is hereby set aside.

“NERC is hereby directed to reverse to the status quo and the commission is hereby restrained from further increasing electricity tariff except it complies strictly with the relevant provisions of the EPSRA”, the court said.

The sum of 50,000 Naira was awarded in favour of the plaintiff.

Court Orders NERC To Reverse Increase In Electricity Tariff

Jimoh Ibrahim, NICON, Global FleetThe Federal High Court sitting in Lagos has annulled the increment in electricity tariff recently announced by the Nigerian Electricity Regulatory Commission (NERC).

Justice Mohammed Idris, who delivered judgment in a suit filed by a Lagos based lawyer, Mr. Toluwani Adebiyi, challenging the increment, described NERC’s action as irrational, irregular and illegal.

The court, while relying on Sections 31, 32 and 76 of the Electricity Power Sector Reform Act (EPSRA) 2005, in deciding the substantive suit, held that, “NERC acted outside the powers conferred on it by the Act and failed to follow the prescribed procedure.

The court was also of the view that “NERC has not shown that it acted in due obedience to the prescribed procedures and that there is no evidence that NERC complied with Section 76(6)(7) and (9) of the EPSRA Act.

The court further held that “of all the legal requirements, it appeared the only one complied with by NERC was that it announced the new tariff in the newspapers.

The court said that, “it is clear from the affidavit evidence that the increase in tarriff was done by NERC in defiance of the order of the court made on May 28, 2015 which directed parties in the case to maintain the status quo”.

On this issue, the court said, “the law is that every person upon whom an order is made by a court of competent jurisdiction must obey it, unless and until the order is discharged and set aside at the Appeal.

Consequently, the court held that,” the tariff increase from July 1, 2015 was done in breach of the ‘status quo’ order”, adding that “NERC’s action, was therefore, clearly hasty, reckless and irresponsible”.

Speaking further, Justice Idris said, “this country is in a democracy where the rule of law shall prevail over impunity or whimsical desires. Anything to the contrary will be an invitation to anarchy.

“It is the law that what is done officially must be done in accordance with the law. Investors are free to do business in Nigeria but they shall abide by the law of this country. Nigeria is not a kangaroo State. Nigeria is not a banana Republic.

“It is intolerance and extremely dangerous for any branch of the Executive to create a posture it may not obey certain orders of the court. That is tantamount to Executive recklessness which will lead to lawlessness”, he said.

In view of these, the court while invoking its disciplinary jurisdiction, ordered that “the increment in electricity tariff which took effect after the institution of this action and while a restraining order is subsisting is hereby declared illegal and same is hereby set aside.

“NERC is hereby directed to reverse to the status quo and the commission is hereby restrained from further increasing electricity tariff except it complies strictly with the relevant provisions of the EPSRA”, the court said.

The sum of N50,000 was awarded in favour of the plaintiff.

The court had earlier held that it indeed has the jurisdiction to entertain the matter.

In deciding on the issue of jurisdiction, the court made explanations on four issues: These are: whether or not the suit was properly commenced; whether or not the plaintiff has ‘locus standi’ to file the action; whether or not the suit was statute barred and whether or not the suit disclosed a reasonable cause of action.

On the first issue, the court held that the suit was properly commenced by originating summons.

“Having looked at the affidavit evidence, it is my view that there are no substantial disputes of facts on the materials needed for the determination of this suit. I therefore hold that this suit is properly commenced by an originating summons. The originating summons filed by the plaintiff contains the questions for determination and the reliefs sought from the court in compliance with the rules of the court”.

Court Re-affirms Existing Order Against Electricity Tariff Increase

Electricity-meter electricity tariff increaseA Federal High Court in Lagos has re-affirmed the existing order restraining the Nigerian Electricity Regulatory Commission (NERC) from implementing any upward review of electricity tariff.

While delivering a ruling on Monday on the objections of the NERC to a contempt charge against them, Justice Mohammed Idris asked the NERC to abide by the court order pending the hearing and final determination of a suit filed by a lawyer and rights activist, Toluwani Adebiyi, over the issue.

The plaintiff, Mr Adebiyi had sought to commit the NERC Chairman and the CEOs of the Distribution Companies (Discos) to prison for announcing the implementation of the new electricity tariff despite a subsisting court order barring same.

In his ruling, Justice Idris said: “Let me warn that when the disciplinary jurisdiction of this court is properly invoked, anyone who is found to have ignored the order of the court will be dealt with severely. The order of this court that parties in this suit should maintain the status quo remains valid and binding until it is set aside by a court of competent jurisdiction”.

“The issue of disobedience to court’s order is one that affects the integrity of the court. There is a need for the court to assert its authority and deal with any issue that is capable of bringing it to disrepute. Those who intend to take the judicial system for a ride should think twice and those who have done so should retrace their steps, the long arm of the law will catch up with them no matter how long it takes,” he further stressed.

Justice Idris had earlier in his ruling set aside the Form 49 and the motion for committal to prison filed against the defendants by the plaintiff.

The judge held that the issuance of form 49 on the defendants by the plaintiff without prior and proper service of form 48 was premature.

“In the circumstance, I hold that the defendant’s objection has merit. The court has set aside the contempt application due to fundamental and procedural irregularities,” the judge said.

The court has since adjourned till March 15 for hearing of all pending applications.

Adebiyi’s Substantive Suit

Mr Adebiyi, in the substantive suit, is seeking an order restraining NERC from implementing any upward review of electricity tariff without a meaningful and significant improvement in power supply at least for 18 hours in a day in most communities in Nigeria.

He also wants an order restraining NERC from foisting compulsory service charge on pre-paid meters not until “the meters are designed to read charges per second of consumption and not a flat rate of service not rendered or power not used”.

He also wants the service charge on pre-paid meters not to be enforced until there is visible efficient and reliable power supply like those of foreign countries where the idea of service charge was borrowed.

Adebiyi is further asking for an order of court mandating the NERC to do the needful and generate more power to meet the electricity use of Nigerians, adding that the needful should include and not limited to a multiple long-term financing approach, sourced from the banks, capital market, insurance and other sectors of finance to power the sector.

Finally, the lawyer is asking the court to mandate the NERC to make available to all Nigerians within a reasonable time of maximum of two years, prepaid meters as a way to stop the throat-cutting indiscriminate estimated bill and which must be devoid of the arbitrary service charge, but only chargeable on power consumed.

In an affidavit in support of the suit personally deposed to by the applicant, the lawyer lamented that despite the motto and mission of NERC which were expressly stated as “keeping the light on and to meet the needs of Nigeria for safe, adequate, reliable and affordable electricity,” most communities in Nigeria do not get more than 30 minutes if electricity supply, while the remaining 23 hours and 30 minutes were always without light and in total darkness.

“Nigeria poor masses are paying an estimated and indiscriminate residential bills ranging from 5, 000 Naira to 18, 000 Naira, spending an average of 15, 000 Naira to 20, 000 Naira for fuel to maintain generating set.

“Businesses have collapsed, industries have closed down, and residents cannot sleep comfortably at night due to inefficiency of our power industry”.

“Companies and commercial Houses are groaning under throat-cutting power bill which they are paying for, yet not getting the benefit for such payment,” Adebiyi stated.

He stressed that the proposed increase in electricity tariff was coming amidst the tangled web of poor power supply with no reasonable proof of improvement.

“The situation is self-evident, it readily speaks for itself because everyone is suffering from poor power outrage.

“Bringing further increase amidst this tangled web of hardship and without any improvement in power supply, will be highly unjustifiable and will be an economic burden on Nigeria populace. It is totally absurd and not for the good of the people, and therefore must be stopped,” Adebiyi submitted.

Electricity Tariff: Court Warns FG, DISCOs Not To Disobey Subsisting Orders

CourtThe Federal High Court sitting in Lagos has warned the Federal Government and the Distribution Companies (DISCOs) not to disobey subsisting court orders on electricity tariff.

The court also warned the government not to act in a way that showed disdain for the court in a constitutional democracy.

Presiding Justice, Mohammed Idris,  gave the warning while ruling in a suit filed by a lawyer and rights activist, Toluwani Adebiyi, over the recent hike in electricity tariff on Monday.

Justice Idris fixed Friday, February 19 to hear an application by the Nigerian Electricity Regulatory Commission (NERC) seeking a stay of proceedings in the suit.

The judge fixed the date after listening to the arguments of lawyers representing parties in the matter over the order in which pending applications should be taken by the court.

Mr Adebiyi filed a suit seeking a perpetual injunction restraining NERC from implementing any upward review of electricity tariff without significant improvement in power supply for at least 18 hours a day in May 2015.

He also wants an order restraining NERC from foisting compulsory service charges on pre-paid meters until “the meters were designed to read charges per second of consumption and not a flat rate of service not rendered or power not used.”

Multiple Long-term Financing Approach

Mr Adebiyi wants the service charge on pre-paid meters not to be enforced until there is visible efficient and reliable power supply like those of foreign countries where the idea of service charge was borrowed.

He further asked for an order of court mandating the NERC to do the needful and generate more power to meet the electricity use of Nigerians, emphasising that the needful should include and not limited to a multiple long-term financing approach, sourced from the banks, capital market, insurance and other sectors of finance to power the sector.

Throat-cutting Bill

The lawyer also asked the court to mandate the NERC to make available to all Nigerians within a reasonable time of maximum of two years, prepaid meters as a way to stop the throat-cutting indiscriminate estimated bill which must be devoid of the arbitrary service charge, but only chargeable on power consumed.

In an affidavit in support of the suit personally deposed to by the applicant, the lawyer lamented that despite the motto and mission of NERC which were expressly stated as “keeping the lights on and to meet the needs of Nigeria for safe, adequate, reliable and affordable electricity,” most communities in Nigeria do not get more than 30 minutes of electricity supply, while the remaining 23 hours and 30 minutes were always without light and in total darkness.

“Nigeria’s poor masses are paying an estimated and indiscriminate residential bill ranging from 5, 000 Naira to 18, 000 Naira, spending an average of 15, 000 Naira to 20, 000 Naira for fuel to maintain generating set.

“Businesses had collapsed, industries had closed down, and residents cannot sleep comfortably at night due to inefficiency of our power industry.

“Companies and commercial houses are groaning under throat-cutting power bill which they are paying for, yet not getting the benefit for such payment,” Adebiyi stated.

Poor Power Supply

He stressed that the proposed increase in electricity tariff came amidst the tangled web of poor power supply with no reasonable proof of improvement.

“The situation is self evident, it readily speaks for itself because everyone is suffering from poor power outrage.

“Bringing further increase amidst this tangled web of hardship and without any improvement in power supply will be highly unjustifiable and will be an economic burden on Nigeria populace. It is totally absurd and not for the good of the people and therefore must be stopped,” Adebiyi submitted.

Justice Idris had made an order directing parties to maintain status quo and for NERC to suspend all actions relating to any increment in electricity tariff pending the hearing and final determination of the suit.

But while the suit was pending, NERC in conjunction with the Electricity Distribution Companies commenced the implementation of the new electricity tariff on February 1.

Protests by labour unions had since trailed the new power tariff.

At the proceedings, the plaintiff drew the court’s attention to an application seeking to commit the NERC’s Chairman and the CEOs of the Distribution Companies (Discos) to prison for allegedly flouting the order.

But NERC’s lawyer, Chief Anthony Idigbe (SAN), said he had filed an appeal against the order by Justice Idris.

He also said he had a pending application for a stay of the proceedings pending the determination of the appeal.

Mr Idigbe mentioned that the plaintiff had not effected service of the contempt proceedings on the alleged contemnors.

The two lawyers were divided on which application should be heard first.

Mr Adebiyi said the contempt charge should be heard first since NERC had undermined the court’s authority, but Mr Idigbe said the application for stay of proceedings should take precedence since an appeal had been lodged.

In a short ruling on the issue, Justice Idris, held that it was in the interest of justice to first hear the defendant’s application for a stay of proceedings pending the determination of their appeal against the court’s order.

The plaintiff then asked for a short adjournment to enable him file his response to the application.

Justice Idris subsequently adjourned till Friday for the hearing of the application for a stay of proceedings.

Court Restates Order Restraining NERC From Increasing Electricity Tariff

electricityA Federal High Court sitting in Lagos on Thursday renewed an earlier order restraining the Nigerian Electricity Regulatory Commission (NERC) from implementing the new electricity tariff billed to be effective from June 1, 2015.

Justice Mohammed Idris, had in a ruling on an ex-parte application filed by a Lagos lawyer, Toluwani Yemi-Adebiyi, last week, restrained the NERC and the electricity distribution companies from effecting any increment in electricity tariff pending the hearing and determination of the suit.

When the matter came up for hearing, Adebiyi told the court that as directed, all the processes in the matter, including the enrolled order of court, had been served on the NERC.

He added that by the provisions of the rules of court, NERC had seven days to respond, but that the commission was yet to do so.

He said in as much as he would love to proceed, it would be fair to give the commission benefit of the doubt.

He, however, urged the court to renew the order, so as to preserve the subject matter of the suit.

In response, counsel to the NERC, Ifeanyi Umunna, said that the commission had complied with the interim orders of court.

He added that the NERC was in the process of appointing a counsel to defend the suit, and pleaded for more time to do so.

Justice Idris, in a short ruling, held that “the ex-parte order remains valid and subsisting”.

The matter was thereafter adjourned to July 9, 2015 for hearing.

Court Stops NERC From Increasing Electricity Tariff

ElectricityA Federal High Court in Lagos on Thursday restrained the Nigerian Electricity Regulatory Commission (NERC) from implementing the new electricity tariff billed to be effective from June 1, 2015.

Trial judge, Justice Mohammed Idris, in a ruling on an ex-parte application filed by a Lagos lawyer, Toluwani Adebiyi, restrained the NERC and the electricity distribution companies from effecting any increment in electricity tariff pending the hearing and determination of the suit.

Adebiyi, who argued the ex-parte application in person, had urged the court to restrain the NERC and the electricity distribution companies from foisting further hardship and unjustifiable tariff increment on Nigerians, as widely announced by the Commission.

NERC Chairman, Dr Sam Amadi had, at a news conference in Abuja, announced plans by the Commission to implement the upward review in electricity tariff effective from June 1.

Amadi had further said that with the review, most electricity companies will retain the N750 fixed charge.

But Justice Idris, after entertaining arguments from Adebiyi, ordered the NERC to maintain status quo with effect to the planned upward review of electricity tariff.

The judge ordered that the motion and other processes in the suit should be served on the NERC.

Justice Idris also granted leave to the applicant (Adebiyi) to serve the originating summons, the affidavit in support, list of exhibits and the written address on the defendant (NERC) in Abuja, which is outside Lagos judicial division of the Federal High Court.

The judge also adjourned the suit to June 11, 2015 for hearing.

Adebiyi, in the suit, is seeking an order restraining the NERC from implementing any upward review of electricity tariff without a meaningful and significant improvement in power supply at least for 18 hours in a day in most communities in Nigerian.

He also wants an order restraining the NERC from foisting compulsory service charge on pre-paid meters not until “the meters are designed to read charges per second of consumption and not a flat rate of service not rendered or power not used.”

He also wants the service charge on pre-paid meters not to be enforced until there is visible efficient and reliable power supply like those of foreign countries where the idea of service charge was borrowed.

Adebiyi is further asking for an order of court mandating the NERC to do the needful and generate more power to meet the electricity use of Nigerians, adding that the needful should include and not limited to a multiple long-term financing approach, sourced from the banks, capital market, insurance and other sectors of finance to power the sector.

Finally, the lawyer is asking the court to mandate the NERC to make available to all Nigerians within a reasonable time of maximum of two years, prepaid meters as a way to stop the throat-cutting indiscriminate estimated bill and which must be devoid of the arbitrary service charge, but only chargeable on power consumed.

In an affidavit in support of the suit personally deposed to by the applicant, the lawyer lamented that despite the motto and mission of NERC which were expressly stated as “keeping the light on and to meet the needs of Nigeria for safe, adequate, reliable and affordable electricity,” most communities in Nigeria do not get more than 30 minutes if electricity supply, while the remaining 23 hours and 30 minutes were always without electricity and in total darkness.

“Nigeria poor masses are paying an estimated and indiscriminate residential bills ranging from N5, 000 to N18, 000, spending an average of N15, 000 to N20, 000 for fuel to maintain generating set.

“Businesses have collapsed, industries have closed down, and residents cannot sleep comfortably at night due to inefficiency of our power industry.

“Companies and commercial houses are groaning under throat-cutting power bill which they are paying for, yet not getting the benefit for such payment,” Adebiyi stated.

He stressed that the proposed increase in electricity tariff was coming amidst the tangled web of poor power supply with no reasonable proof of improvement.

“The situation is self evident, it readily speaks for itself because everyone is suffering from poor power outrage.

“Bringing further increase amidst this tangled web of hardship and without any improvement in power supply, will be highly unjustifiable and will be an economic burden on Nigeria populace. It is totally absurd and not for the good of the people, and therefore must be stopped,” Adebiyi submitted.‎