Kester E.
The Nigerian Electricity Regulatory Commission (NERC) has given the green light to a staggering 240.9 percent surge in electricity tariffs for customers falling under the band A category.
During a press conference held in Abuja on Wednesday, NERC Vice Chairman Musiliu Oseni unveiled this hike. Customers classified within this band, who currently receive 20 hours of daily electricity supply, will now be charged N225 per kilowatt (kW) instead of the previous N66 rate.
Oseni remarked that Band A customers make up about 15 percent of the country’s 12 million electricity consumers. Furthermore, he mentioned that the commission has downgraded certain customers from Band A to Band B due to the failure of electricity distribution companies to fulfill the required supply hours.
“We are reducing the number of feeders in the Band A category from 800 to fewer than 500. This means that just 17 percent will now qualify as Band A feeders, serving only 15 percent of total electricity consumers connected to these feeders,” Oseni stated.
The NERC has issued a supplementary order called the April supplementary order, allowing for 235 kilowatt-hours. Oseni clarified that this revision will not impact customers in other bands.
According to Bloomberg’s sources, power companies are now permitted to raise urban electricity tariffs to N200 ($0.15) per kWh from the previous N68 rate. This move is reportedly aimed at attracting fresh investments and cutting the approximately $2.3 billion used to cap tariffs, as insiders in the presidency revealed.
Bloomberg further highlighted that Nigerians will see a rise to $2.42 per one million British thermal units in comparison to the former rate of $2.18 MMBtu.
These changes coincide with the recent announcement made by the Nigerian Midstream and Downstream Petroleum Regulatory Authority regarding a hike in natural gas prices. This increase is pertinent as natural gas fuels over 70 percent of electricity generation in Nigeria.
