Minister of Power, Adebayo Adelabu, has said the increase in electricity tariffs for Band A customers is a temporary hardship that will lead to a permanent gain.
Speaking at the sectorial briefing of the ministers in Abuja, Adelabu expressed confidence that the tariff will gradually drop as the power sector in the country increases its output.
According to him, the tariff can be compared to the initial price surge observed in the telecommunication sector, which eventually went down over time.
“The electricity tariff might look expensive at the moment. But I’m optimistic that these tariffs will go down. We know how much we are buying sim cards when Telecom just came. We knew how much we were buying telephones,” Adelabu said.
“But gradually as we scale up in generation, transmission and distribution, these prices will also go down. It’s a temporary hardship that will lead to a permanent gain.”
He stated that for the first time in the history of Nigeria, the power distribution companies (DisCos) can guarantee 20 hours of power supply for a minimum of 15% of customers under the Band A category.
“In distribution, our DisCos are more responsive and active. Today, discos will send you information and update of power outages at a given period of time. Now, they have woken up to their responsibility because of improved regulatory oversights.
“For the first time in the history of Nigeria, we have what is called guaranteed improved service level.
“It might be for Band A today but no government has ever guaranteed 20 hours of supply not to even 1% of consumers. But to 15% of consumers, we said let us start from here.
“And we have guaranteed service level for Band A customers with the introduction of cost-reflective tariffs to that Band, a key liquidity condition suitable for driving investment.”
The Nigerian Electricity Regulatory Commission (NERC) increased the electricity tariff for customers under the Band A category from N66/kWh to N225.
NERC Vice Chairman, Musiliu Oseni said that these customers account for 15% of the 12 million electricity consumers in the nation.
