New Electricity Tariff May Require Band ‘A’ Residents To Spend Over N200,000 Monthly

The recent Nigerian Electricity Regulatory Commission (NERC) tariff hike is expected to affect 1,974,385 electricity consumers.

Before the recent changes, the average Nigerian ‘Band A’ customer paid roughly N60,000 monthly for electricity, which has soared to N204,000.

NERC authorized an increase in the electricity tariff per unit from about N66 to N225 for the different distribution companies (DisCos) in Nigeria, effective as of yesterday.

With the approval of a 240 per cent increase, the tariff for ‘Band A’ power consumers has surged from N66 per kilowatt hour (kwh) to N225/KwH, effective this month.

The Commission’s Vice Chairman, Musliu Oseni, specified during a press briefing in Abuja on Wednesday that the tariff adjustment would exclusively apply to customers with 20-hour or more power supply across the nation, exempting those in Bands B, C, D, and E who use less than 20 hours of electricity per day.

NERC indicated that the adjustments would only affect a fraction of the over 3,000 DisCos’ feeders, specifically less than 481 feeders, which make up 15 per cent of the over 12 million electricity consumers encompassed by the Nigerian Electricity Supply Industry (NESI).

Oseni also disclosed that NERC had mandated the downgrade of most feeders that previously failed to meet the 20-hour supply threshold to lower bands.

Labour associations and concerned citizens have advised the government against removing electricity subsidies, a proposition put forward by the International Monetary Fund (IMF).

The IMF, in its recent report titled ‘IMF Executive Board Concludes Post Financing Assessment with Nigeria,’ reiterated the necessity of eliminating subsidies to redirect resources toward more targeted and impactful social welfare programs.

Amid the ongoing cost-of-living crisis, the IMF suggested implementing targeted social transfers to offer temporary assistance to the most vulnerable segments of the Nigerian population.

In light of the recent tariff hike, the situation and found that an average Band ‘A’ consumer, previously spending N60,000 monthly on electricity for their appliances, is now expected to pay around N204,000, representing a significant increase of 240.9%.

Previously, N60,000 could purchase 909.09 KwH or units, but now it can only buy 266.66 KwH or units.

In defence of the heightened charges, the NERC pointed out that premium customers could significantly reduce or eliminate expenditures on diesel and petrol generators, as they would now have access to uninterrupted power supply for 20 hours or more.