The Federal Government has announced plans to review the electricity tariffs for Band B and C customers, aiming to address the disparities in the current billing system and encourage investment in the power sector. Minister of Power, Adebayo Adelabu, announced this at the public presentation of the National Integrated Electricity Policy and Nigeria Integrated Resource Plan in Abuja.
The current tariff structure has been criticized for being unfair, with customers in Band B paying N63 per kilowatt-hour for 17-18 hours of electricity supply, while those in Band A pay N209 per kilowatt-hour for just two hours more of supply. The government wants to create a more balanced and equitable pricing system.
According to Adelabu, the government is considering this option due to the slow pace of migration to Band A customers, which he attributed to the reluctance of Distribution Companies to make the necessary investments. The minister emphasized the need for a regularisation of the tariffs to create a more balanced and equitable pricing system.
Adelabu described the current tariff structure as “unfair” and stressed the need for a review to address the disparities. The government is committed to making the necessary adjustments to ensure a fair and sustainable electricity pricing system.
The review of the electricity tariffs is part of the government’s efforts to reform the power sector and provide affordable and reliable electricity to Nigerians. The government is working to address the challenges facing the sector, including inadequate infrastructure, high transmission losses, and inefficient distribution networks.
The minister said, “We will look at the tariff again. I am not saying that we’re going to increase the tariff before I am misquoted.“We are going to look at it and see how we can improve upon our modest achievement of last year, not only to ensure that we grow the sector that we need but also to ensure that we can invest more in revamping all these dilapidated infrastructures.”“The migration to Band A should have been faster, but we found out that the DisCos refuse to invest. They have refused to invest in this sector.
“A lot of investment is required for us to achieve an accelerated migration of lower-band customers into Band A. It is taking a lot of time.”In response to this, the government is considering restructuring the tariff bands, reducing the current wide gap between them.
A new system, proposed to encompass Bands A, B, and C, would address these inequalities. “The gap between the Band A tariffs and Bands B, C, D, and E is just too wide,” he said. “We believe it’s not fair. It is not just, and we must be able to carry out some level of regularisation.”The minister clarified that the review does not imply an imminent increase in rates. The government is committed to ensuring that the review process is transparent and fair, and that the interests of consumers are protected.
