The Nigerian Electricity Regulatory Commission (NERC) has revealed that a total of 1,974,385 electricity consumers will be affected by its recent tariff hike. The decision to increase tariffs aims to significantly reduce the estimated N2.9 trillion electricity subsidy in the 2024 fiscal year. This move became necessary due to cash flow constraints stemming from the federal government’s inability to meet obligations to the Nigeria Electricity Market.
Mr. Musliu Oseni, Vice Chairman of NERC, explained that the tariff hike is targeted at ensuring that only customers receiving at least 20 hours of electricity daily are placed in Band A. To achieve this, the number of feeders meeting the threshold has been reduced from 875 to less than 500. Approximately 15% of the 13,162,572 electricity customers nationwide will be affected by the tariff increase, while the rest will continue paying the old rates until supply improves and they are migrated to the new Band A.
NERC expects that the additional revenue generated from the tariff hike will attract investments into the sector, ultimately leading to improved service delivery. The commission also pledges to utilize various tools to ensure that customers in Band A receive the guaranteed daily hours of electricity supply from distribution companies (DisCos).
Source: Vanguard