Nigerians Should Expect Another Hike In Electricity Tariffs

Nigerians should expect another electricity tariff hike in coming months.
Government aims to balance cost-reflective tariffs with subsidies for the poor.
Only 4-5GW of power reaches homes despite Nigeria’s 14GW capacity.

Nigerians should prepare for another increase in electricity tariffs in the coming months, as the Special Adviser to President Bola Tinubu on Energy, Olu Verheijen, has confirmed plans for an upward adjustment in power prices.

EDITOR’S PICKS

EKO HOT BLOG reports that Verheijen disclosed this while speaking at the Africa Heads of State Energy Summit in Dar es Salaam, Tanzania. The revelation comes just months after the Federal Government approved a threefold hike in electricity tariffs for Band A customers on April 3, 2024.

According to the presidential aide, Nigeria’s electricity tariffs need to rise by about 66% for many consumers to reflect the true cost of electricity supply.

“One of the key challenges we’re looking to resolve over the next few months is transitioning to a cost-efficient but cost-reflective tariff,” Verheijen stated.

She emphasized the need to strike a balance between increasing tariffs and maintaining subsidies for low-income consumers, ensuring that electricity remains accessible while also funding system maintenance, improving reliability, and attracting private investment.

Verheijen further noted that Nigeria’s power sector requires significant investment to function efficiently and meet national development goals.

She pointed out that despite Nigeria having an installed power capacity of 14 gigawatts, only eight gigawatts can be transmitted nationwide, while just four to five gigawatts reach homes and businesses.