Power consumers across Nigeria have strongly opposed the Federal Government’s plan to increase electricity tariffs by over 66%, raising concerns over affordability and service quality.
Tariff Increase Proposal
The Special Adviser to President Bola Tinubu on Energy, Olu Verheijen, disclosed that electricity prices must rise by two-thirds to reflect actual supply costs. The proposed increase would see tariffs rise from N116.18/kWh to N193.63/kWh.
Key reasons for the hike:
- To improve power reliability by funding maintenance.
- To attract private investment into power generation and transmission.
- To reduce government subsidy burdens, which currently cover 67% of electricity costs for many consumers.
Consumers’ Concerns
Electricity customers and consumer rights groups argue that:
- The government should first provide prepaid meters to all customers before increasing tariffs.
- Service quality remains poor, with power generation fluctuating around 4,500MW for a country of over 200 million people.
- Estimated billing practices may lead to unfair charges for those without meters.
- Many businesses and households are already struggling financially and may not afford the hike.
Electricity Distribution Companies’ (DisCos) Stand
DisCos insist that:
- Only Band A consumers currently pay the cost-reflective tariff of N209/kWh (guaranteeing 20 hours of supply daily).
- Band B-E customers enjoy subsidies, which the government has failed to reimburse, causing financial distress in the sector.
- The Federal Government’s failure to pay subsidies has led to liquidity issues.
Consumer Protection Groups Take Legal Action
Consumer advocacy groups, including the Electricity Consumers Protection Forum, are:
- Challenging the hike in court.
- Demanding that DisCos provide free meters as required by the Electricity Act 2023.
- Pressuring regulators to ensure fair billing practices.
Government’s Position
The Minister of Power’s Special Adviser, Bolaji Tunji, said:
- There is no immediate tariff increase, but it cannot be ruled out in the future.
- The government aims to strengthen the grid and gradually migrate more consumers to Band A.
Sector Experts Support Tariff Adjustment
Some industry experts argue that the subsidy regime is unsustainable and tariff increases are necessary for sector growth.
Power Sector Challenges
- Repeated grid collapses and infrastructure vandalism have hindered power stability.
- Over 250 companies and institutions have disconnected from the national grid to generate their own power.
With rising costs and service concerns, the proposed tariff increase remains a heated debate between the government, DisCos, and power consumers.
