The Federal Government and the Nigerian Labour Unions have agreed to suspend the electricity tariff increase for a period of two weeks. This was part of the agreement reached between Labour and the Government as they deliberated to avert a nationwide strike that would have grounded an already deteriorating economy.
While the strike was over two major issues, an increase in electricity charges and fuel price respectively, the decision to call off the strike was based on the suspension of the electricity bills. The following terms of reference underpinned the agreement between Labour and the Government.
Explore the Nairametrics Research Website for Economic and Financial Data
Terms of reference for suspension of electricity increase for 2 weeks.
Terms of reference “The Terms of Reference (ToR) are as follows: To examine the justification for the new policy on cost-reflective Electricity Tariff adjustments.”
- Both parties are to examine the justification for the new policy on cost-reflective tariff adjustment
- To look at the different Electricity Distribution Company (DISCOs) and their different electricity tariff vis-à-vis NERC order and mandate.
- Examine and advise government on the issues that have hindered the deployment of the six million meters.
- To look into the NERC Act under review with a view to expanding its representation to include organized labour.
- The Technical sub-committee is to submit its report within two weeks.
- During the two weeks, the DISCOs shall suspend the application of the cost-reflective electricity tariff adjustments. “The meeting also resolved that the following issues of concern to Labour should be treated as stand-alone items:
- The 40% stake of government in the DISCO and the stake of workers to be reflected in the composition of the DISCOs Boards.
- An all-inclusive and independent review of the power sector operations as provided in the privatization MOU to be undertaken before the end of the year 2020, with Labour represented.
- That going forward, the moribund National Labour Advisory Council, NLAC, be inaugurated before the end of the year 2020 to institutionalize the process of tripartism and socio dialogue on socio-economic and major labour matters to forestall crisis.
What this means: The decision reached between the government and labour means the service reflective tariff regime which started on September 1, 2020, is effectively suspended. Customers are therefore no longer required to pay the service reflective tariffs and will revert to the previous MYTO tariffs of 2015.
- By looking at the “different Electricity Distribution Company (DISCOs) and their different electricity tariff vis-à-vis NERC order and mandate” it appears labour might be looking to recalibrating the tariffs for some Discos.
- According to documents on the tariff order published by the NERC, some Discos have tariffs for residential customers that are as high as N62/kWh while it’s just under N54 for others.
- Labour could also get involved in determining the veracity of the tariff bands that determines which customers pay what as electricity tariffs.
Exxon Mobil to cut 14,000 jobs as pandemic hit oil demand, prices
Exxon Mobil announced it will slash its global workforce by 15% over the next two years, as it struggles to preserve dividends.
Exxon Mobil Corp on Thursday, October 30, 2020, announced that it will reduce its global workforce by 15% by the end of 2022 – an unprecedented culling by North America’s biggest oil explorer, as the coronavirus pandemic hits energy demand, prices, and struggles to preserve dividends.
The job cuts are expected to include 1,900 U.S. jobs – mostly in Houston, the headquarters for its US oil and gas businesses – as well as layoffs previously announced in Europe and Australia and reductions in the number of contractors, some of which have already taken place.
This was disclosed in a statement that was released by the energy giant on Thursday, October 30, 2020.
The staff reduction is part of the latest effort by the Chief Executive Officer, Darren Woods, to curtail spending and halt the worst string of quarterly losses since Exxon assumed its modern form with the 1999 takeover of Mobil Corp.
What you should know
Exxon and other oil producers have been slashing costs due to a collapse in oil demand and prices, as well as ill-timed bets on new projects. The Big Oil rivals of Exxon are also cutting thousands of jobs in response to the pandemic-induced demand slump. BP Plc plans to slash 10,000 jobs, Royal Dutch Shell Plc will cut as many as 9,000 roles, and Chevron Corp. has announced around 6,000 reductions.
Norton said that Exxon’s workforce stood at about 88,000 people, including 75,000 in-house employees and about 13,000 contractors as of year-end 2019.
Exxon’s job cut is a sign of its weakened financial position compared to its former status as the S&P 500 Index’s biggest company less than a decade ago, and a profit powerhouse used to ride out oil-price cycles.
This year’s downturn has been particularly damaging because it also affected refining, usually a cushion in times of low oil prices. Also, it came at a time when Exxon was already increasing borrowing to fund a large expansion program. The company was forced to retreat on these plans in April, reducing capital spending by $10 billion and delaying or scaling back most of the major projects.
The stock has plunged more than 50% this year. Its dividend yield is now more than 10%, indicating that investors are anticipating a cut. Exxon maintained the quarterly payout on Wednesday and is expected to post its third consecutive quarterly loss when it reports earnings tomorrow.
What they are saying
The Company in its statement said, “These actions will improve the company’s long-term cost competitiveness and ensure the company manages through the current unprecedented market conditions.’’
Exxon’s spokesman, Casey Norton, through an email said that the total reduction means the company will reduce its workforce by about 14,000 people, split between employees and contractors from year-end 2019 levels. The cuts will come through attrition, targeted redundancy programs in 2021, and scaled-back hiring in some countries.
What this means
Another set of job losses in the oil sector in Nigeria is looming. Nigeria is one of Exxon’s biggest operational bases in oil and gas exploration and production globally. Also, this is another setback after Shell announced 9,000 job cuts globally, which includes Nigeria, and the announcement by Chevron that it plans to reduce its staff strength in Nigeria by 25%.
FG to invest in the deployment of Mini-grid systems to power 5 million homes in 2021
The Minister said the government will invest in Mini-grid systems that will provide power for 5 million homes in 2021.
In a bid to provide remote communities with clean and affordable energy, the Minister of Power, Engineer Sale Mamman has disclosed that the Government is set to invest heavily in the deployment of Mini-grid systems that will provide power for 5 million homes in 2021.
This disclosure was made by Engr. Sale Mamman in a statement released into the mainstream media via his official Twitter handle.
It is virtually impossible to have the National grid covering every geographical point within Nigeria, that is why Government is investing heavily in the deployment of Mini-grid systems which can easily get to the most remote communities and provide clean, affordable energy.
— Engr. Sale Mamman (@EngrSMamman) October 29, 2020
The Minister explained that it is virtually impossible for the National grid to cover every geographical point within Nigeria. He emphasized that this reality prompted the present administration to sort out alternatives, and as a result, the Government is set to invest heavily in the deployment of Mini-grid systems, which can easily get to the most remote communities and provide clean, and affordable energy in 2021.
What they are saying
The Minister, in his statement, said, “It is virtually impossible to have the National grid covering every geographical point within Nigeria, that is why the Government is investing heavily in the deployment of Mini-grid systems, which can easily get to the most remote communities and provide clean, affordable energy.
“In 2021, part of our priorities at the Ministry and two of its implementing agencies will be on providing these Mini-grid systems for communities and stand-alone home solar systems. We have a target of 5 million homes. Clean, affordable, and accessible energy for all.”
What you should know
The Minister of Power, Engineer Sale Mamman, at the 2021 budget defense before the House of Representatives Committee on Power in Abuja, yesterday disclosed that Nigeria’s installed grid power generation capacity has grown from 8,000MW to 13,000MW under the leadership of President Muhammadu Buhari.
The Minister also pointed out that the distribution system had the capacity to evacuate 5,500MW of power, which is a significant improvement from 4,500MW in 2015.
Electricity: Nigeria now has an installed generation capacity of 13,000MW – Minister of Power
Engineer Sale Mamman has disclosed that Nigeria’s installed grid power generation capacity has grown from 8,000mw to 13,000mw.
The Minister of Power, Engineer Sale Mamman, has disclosed that Nigeria’s installed grid power generation capacity has grown from 8,000mw to 13,000mw under the leadership of President Muhammadu Buhari.
A statement was issued by the Office of the Minister of Power via its official Twitter handle.
Nigeria now generates 13,000mw of power, says Minister.
The Minister of Power, @EngrSMamman has said that the Nigeria’s installed grid power generation capacity has grown from 8,000mw to 13,000mw under the leadership of President @MBuhari pic.twitter.com/4CJhyS6DXs
— Office of the Minister of Power (@PowerMinNigeria) October 29, 2020
Yesterday, during the 2021 budget defense before the House of Representatives Committee on Power in Abuja, Engr. Sale Mamman said that under the leadership of President Muhammadu Buhari, the capacity of the installed power generation grid has grown from 8,000mw to 13,000mw.
However, members of the committee raised concerns about the power supply to their various constituencies, urging the minister to ensure adequate supply. The Minister explained that the distribution system had the capacity to evacuate 5,500mw of power, which is a significant improvement from 4,500mw in 2015, and better performance should be expected in the near term.
Engr. Aliyu Magaji (APC-Jigawa), the Chairman of the Committee, asked the Minister to mete out stiffer sanctions to the distribution companies (DISCOs), to enable them to sit up and provide the desired services to the Nigerian people.
Magaji said that if the minister ensured the sanction of the DisCos, he would become the darling of lawmakers and the entire Nigerians.
What they are saying
Speaking on the performance of the Ministry since 2015, Engineer Sale Mamman said, “Under the able leadership of President Muhammadu Buhari, the country’s grid power capacity has increased significantly from the time this administration took over in 2015 to date.”
He explained further that, “during the period between 2015 to date, the sector recorded successes and has faced challenges. In order to deliver this administration’s promise of providing stable and affordable power to Nigerians, a way forward was defined and supported by Mr. President’s political will.”