Court strikes out manufacturers’ suit challenging electricity tariff hike

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

In a statement on Wednesday, the Nigerian Electricity Regulatory Commission (NERC) said the judgment delivered on Monday, dismissed the suit for being an abuse of court process.

“The court considered the arguments adduced by the parties and delivered a well-considered judgment on 7 October 2024 by ruling that MAN’s suit was an abuse of court process being premature and without due regard to the provisions of section 51 of the Electricity Act 2023,” NERC said.

“The court also held that MAN’s case disclosed no reasonable cause of action and that by having not exhausted the internal mechanism of resolution of disputes, that the suit was not instituted with due process of law and consequently struck out the case.”

Segun Ajayi-Kadir, the director-general of MAN, did not immediately respond to TheCable’s enquiry regarding the court’s decision.

On April 3, the NERC approved an increase in electricity tariff for customers under the Band A classification.

The commission said customers under the category, who receive 20 hours of electricity supply daily, would begin to pay N225 per kilowatt (kW), starting from April 3.

In defence, Adebayo Adelabu, minister of power, had said the federal government could not afford to pay subsidies on power anymore, hence the need for the tariff hike.

MAN then instituted the suit marked FHC/L/CS/881/2024 against NERC and other DisCos.

The DisCos, which were joined as respondents include the Abuja Electricity Distribution Company (AEDC), the Ibadan Electricity Distribution Company (IBEDC), the Eko Electricity Distribution Company (EKEDC), the Ikeja Electricity Distribution Company (IKEDC), and the Kaduna Electricity Distribution Company (KAEDC).

Others are Kano Electricity Distribution Company (KAEDC), Jos Electricity Distribution Company (JEDC), Benin Electricity Distribution Company (BEDC), Enugu Electricity Distribution Company (EEDC), Port Harcourt Electricity Distribution Company (PHEDC), and Yola Electricity Distribution Company (YEDC).

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

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

Objecting to the suit, NERC submitted that MAN’s case constitutes an abuse of court processes, being hasty and prematurely filed without following due process of the law.