In a move that has sparked widespread debate, the Federal Government has announced a substantial increase in electricity tariffs for Band A customers, who enjoy uninterrupted power supply for 20 hours a day.
Musliu Oseni, Vice Chairman of the Nigerian Electricity Regulatory Commission (NERC), disclosed the development during a press briefing in Abuja, stating, “The increase will see customers pay ₦225 kilowatts per hour, up from the current ₦66.”
Oseni emphasized that these adjustments would only affect a specific segment of consumers, representing 15 per cent of the 12 million electricity customers in the nation. He also highlighted the commission’s decision to downgrade certain customers from Band A to Band B due to non-compliance with the required hours of electricity provision.
“We currently have 800 feeders categorized as Band A, but it will now be reduced to under 500,” Oseni explained, adding that this modification would affect approximately 17 per cent of feeders while servicing 15 per cent of total electricity customers.
Contrary to concerns about broader tariff hikes, Oseni assured that the review would solely impact Band A customers, with no changes for those in other bands. This clarification comes amidst reports from Bloomberg indicating an impending rise in electricity prices to N200 per kilowatt-hour for urban consumers.
The decision, reportedly aimed at attracting new investment and reducing subsidies, follows Monday’s announcement by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) regarding an increase in natural gas prices for power generation.
However, this move arrives in the wake of a recent grid collapse, the second occurrence this year, underscoring Nigeria’s persistent energy challenges. Data from the Transmission Company of Nigeria (TCN) revealed that the grid collapsed, plunging the nation into darkness and halting operations at all 21 connected plants.
In response, the Abuja Electricity Distribution Company (AEDC) issued a statement attributing the outage to a system failure from the national grid, appealing for understanding as efforts are underway to restore normal supply.
Nigeria’s energy sector woes are further underscored by statistics from the Energy Progress Report 2022, which ranked Nigeria with the lowest access to electricity globally, highlighting the urgent need for comprehensive reforms to address the nation’s power deficit.