The federal government announced on Friday the reasons behind the sudden national increase in electricity prices, citing its inability to continue providing N2.93 trillion in power subsidies this year.
The information was provided by Mr. Adebayo Adelabu, the Minister of Power, at a media conference in Abuja that was organised by Mohammed Idris, the Minister of Information and National Orientation.
The Minister of Power made the point that raising the price of energy has become necessary in order for the federal government to cut spending and use the money saved to strengthen the nation’s supply and generation of power.
Adelabu clarified, however, that the 15% of electricity users who receive at least 20 hours of electricity are not impacted by the new tariff increase, and the 85% of users who do not reside in Band A would still receive subsidised power supplies.
The minister stated that the government subsidy will decrease from approximately N2.93 trillion to N1.5 trillion as a result of the small rate hike, freeing up funds for additional investments in the power industry to enhance generation, transmission, and distribution.
The minister clarified that in order to prevent worsening the situation of Nigerians, the administration of President Bola Tinubu was hesitant to eliminate all electrical subsidies due to its empathy for their suffering.
“We cannot remove 100 subsidy because of the suffering of Nigerians. We cannot allow our people to suffer.
According to Adelabu, the cost is still less than that of alternative energy sources like solar and diesel.
The minister also revealed that several projects had been completed in accordance with the 2018 agreement Nigeria and Germany struck to enhance the nation’s electricity supply.
As part of the N2.3 billion agreement between the two countries, Siemens provided three mobile stations and ten power transformers for installation.
This is in response to the Abuja Electricity Distribution Company (AEDC) being fined by the Nigerian Electricity Regulatory Commission (NERC) on Friday for falsely classifying all customers as Band A customers as soon as the federal government announced the pricing rise.
Speaking at a news conference that was attended by the ministers of power and information, Dr. Musiliu Oseni, vice chairman of the Nigerian Electricity Regulatory Commission, announced the sanction on AEDC.
Additionally, Dr. Oseni issued an order to all other distribution companies in the country to either fully reimburse their consumers for whatever excess money they charged them by Thursday of the following week, or face harsh penalties.
Oseni issued a warning, stating that discos must attend to electrical users as soon as possible or face severe penalties under applicable legislation.
This coincides with the fact that the Abuja Electricity Distribution Company (AEDC) was penalised by the Nigerian Electricity Regulatory Commission (NERC) on Friday for falsely classifying all customers as Band A customers as soon as the federal government announced the rise in tariff.
[OpinionNigeria]
Speaking at a news conference that was attended by the ministers of power and information, Dr. Musiliu Oseni, vice chairman of the Nigerian Electricity Regulatory Commission, announced the sanction on AEDC.
Additionally, Dr. Oseni issued an order to all other distribution companies in the country to either fully reimburse their consumers for whatever excess money they charged them by Thursday of the following week, or face harsh penalties.
Oseni issued a warning, stating that discos must attend to electrical users as soon as possible or face severe penalties under applicable legislation.
This coincides with the fact that the Abuja Electricity Distribution Company (AEDC) was penalised by the Nigerian Electricity Regulatory Commission (NERC) on Friday for falsely classifying all customers as Band A customers as soon as the federal government announced the rise in tariff.
The minister said, “Let me reassure every Nigerian that this review is a strategic step toward a more sustainable, efficient, and equitable electricity sector. It lays the groundwork for significant improvements in service delivery, infrastructure development, and economic prosperity. Our focus must therefore remain steadfast on ensuring that the electricity sector’s transformation benefits all Nigerians, supports our industries, and propels our nation towards its bright future.
“You would also recall that the President Bola Ahmed Tinubu signed the Electricity Act (Amendment) Bill, 2024 into law to further strengthen the governance structure in the Power Sector and mandates the GENCOs to set aside five percent of their actual annual operating expenditure from the preceding year for the development of the host communities. The Act also removed Electricity from the Exclusive list to empower state government to generate and distribute electricity to residents,” Idris said.