HeadlineBREAKING: FG Announces Hike In Electricity Tariffs

BREAKING: FG Announces Hike In Electricity Tariffs

GTBCO FOOD DRINL

April 03, (THEWILL) – The Federal Government, through the Nigerian Electricity Regulatory Commission (NERC), has announced an upward review of electricity tariffs for customers in the “Band A” category.

NERC Vice Chairman, Musiliu Oseni, who announced this during a press conference in Abuja, on Wednesday, said the new rate taking effect from Wednesday, April 3 only affects consumers who represent 15 per cent of the 12 million electricity consumers in the nation.

Oseni said the new adjustment will result in those customers paying N225 per kilowatt-hour, up from the current rate of N66.

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He further stated that due to the failure to meet the necessary electricity supply hours, the Commission has moved some Band A customers to Band B.

Oseni, however, said that the review would not impact customers in the other Bands.

“We currently have 800 feeders that are categorised as Band A, but upon reviewing those feeders’ performance, the Commission has now reduced it to under 500. This means that 17% now qualify as Band A feeders. These feeders only service 15% of total electricity customers connected to the feeders.

“The Commission has issued an order, which is titled April supplementary order, taking effect from today.

“The Commission now reviewed further the application by the distribution companies and has decided that only the 17% feeders and less than 15% customers will be affected by any rate increase that the Commission will ever approve for the distribution company.

“The order takes effect from today and in that order, the Commission has approved a rate review of N225 per kilowatt hour for just under 15% of the customer population in NESI. That means that less than 15% of the customers will be affected,” he said.

THEWILL reports that Nigeria operates a fixed tariff system where the Federal Government sets the price of electricity through the NERC.

NERC had in January, said that the Nigerian Government will pay as much as N1.6 trillion to subsidise electricity in the year 2024.

But Minister of Power, Adebayo Adelabu, recently said the government’s continued subsidisation of power was no longer sustainable.

The International Monetary Fund (IMF) has cautioned the Federal Government against the fiscal implications of subsidising fuel and electricity below cost recovery, forecasting a potential impact equivalent to 3 percent of Nigeria’s GDP in 2024.

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