The Nigerian Electricity Regulatory Commission (NERC) has approved a 300% increase in the electricity tariff for Band A consumers to ensure sustainable energy distribution and reduction in subsidy paid by the government.
Accordingly, power distribution companies, DisCos, will be allowed to raise electricity prices for urban consumers to N225 ($0.15) per kilowatt-hour from N68 this month, effective April 1, 2024.
Vice Chairman of NERC, Mr. Musiliu Oseni, who announced this in Abuja, clarified that the rate increase will only affect 15% of the country’s electricity customers.
Oseni also noted that these customers, who represent 15% of the population, consume 40% of the nation’s electricity. These customers are classified under the Band A service category, and the Distribution Companies must provide a minimum of 20 hours/day measured over one week.
The Vice Chairman of the NERC stated that the current review of the end user tariffs would not affect all other customers under the Band B to E-service category, representing 85% of the customer population.
He further revealed that all DisCos have been provided with mandatory targets for investments and migration of more customers to the Band A service category.
“With the newly approved tariffs, subsidies for the 2024 fiscal year are expected to reduce by about N1.14 trillion in furtherance of the Federal Government’s realignment of the subsidy regime. The Commission has established a robust monitoring framework leveraging technology to ensure that the public has visibility of the service covenant with their service providers.”
The NERC leadership also assured Nigerians that the Commission, working with policymakers, remains committed to providing adequate and reliable electricity to all citizens. The Commission diligently works with State governments to deliver on the gains of the Electricity Act 2023.
