Electricity tariff stirs debate in Banana Island estate

The recent increase in electricity tariff implemented by Eko Electricity Distribution Company, (EKO DisCo) is continuing to generate debate among some residents of Banana island estate.

The increase began to impact the power re-charge cost of residents after they returned from the Christmas vacation and some residents jokingly said it was now cheaper to use diesel generators.

Nothing can be farther from the truth though. It costs residents in Banana island estate N65.31per kilowatt/hour (kwh) if you are a pre-paid customer and N67.31 for a post-paid customer. Virtually all collections go to Eko DisCo.

These rates assume a slight margin which goes towards covering the cost of common services like estate streetlights, water treatment plant, sewage operations, the estate office, estate power station, and the fee for maintenance services contracted to electricity services provider Gelmak Limited.

For instance, in January 2021, after settling Eko Disco’s invoice, BIPORAL was left with a positive balance that was barely enough to meet Gelmak’s monthly services fee and cover other costs related to power supply including the replacement of equipment like the large 15 megavolt amperes (MVA) transformers belonging to the estate.

Grid-supplied power is available to residents on the estate for almost 24 hours daily and even with the increase, an average home in Banana still pays only a modest sum monthly for power.

The experts say an average home on the estate will require a circa 40 kilovolt-ampere (kVA) diesel-fired generator which consumes about 4.8 litres an hour according to data commonly available.

For an average of 22 hours daily it will cost the owner N27, 456 at half load and N40, 000 for full load per day.
The approximate cost via Eko Disco and grid-supplied power is about a third or half of the above. Thereafter, it gets even more complex still.

The estate’s common services alone use up more than N8m a month. And then the estate from time to time has to pick up the bill for replacing the large 15 MVA transformer as it did last December for a cost of over N90million including installation fees.

So, whichever way you slice the numbers, Banana island estate residents who enjoy power supply for 99 percent of the day, still have a good deal, especially given the estimate that alternative power costs over N100kwh today.
This excludes the noise and environmental pollution associated with generator use.

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