*Scores of Nigerian electricity consumers, and members of the Organised Private Sector have interrogated the Federal Government’s recent hint at ‘regularising’ Bands B and C tariff structure in line with the what electricity consumers on Band A feeders pay for power supply in the ecosystem

Isola Moses | 绿帽献妻

Electricity consumers, members of the Organised Private Sector (OPS), Civil Society Organisations (CSOs) and small businesses have interrogated the Nigerian Government’s proposal to increase power tariffs for especially consumers on Bands B and C feeders in line with the current tariff payable by Band A consumers.

绿帽献妻 reports the electricity consumers have averred that there is no justification for the any proposed further hikes in electricity tariffs.

Others also have wondered why the Nigerian Government has orchestrated tariff increments for basic services, as well as costs of commodities in various sectors of the economy.

It is also noted that Chief Adebayo Adelabu, Honourable Minister for Power, recently affirmed that the Federal Government yet owes the 24 electricity Generation Companies (GenCos) and 11 electricity Distribution Companies (DisCos) operating in the West African country over N4 trillion in electricity subsidy.

Adelabu disclosed the upcoming regularisation of electricity tariffs for consumers on Bands B and C at the public presentation of the National Integrated Electricity Policy (NIEP) and Nigeria Integrated Resource Plan Thursday, February 27, 2025, in Abuja.l, FCT.

The NIEP initiated in 2024 was developed through a collaborative effort involving power sector professionals and donor partners, including the De the Development Bank, the World Bank, the United Nations Development Programme, the Deutsche Gesellschaft f眉r Internationale Zusammenarbeit, the Tony Blair Institute and the United Kingdom Nigeria Infrastructure Advisory Facility.

The Ministry said the proposal is a about enhancing the liquidity of the Nigerian Electricity Supply Industry (NESI).

Minister: Why regularising existing electricity tariff structure?

The government equally stated that it is considering plans to regularise the electricity tariffs in order to address as apparent disparities in the current billing system for customers outside the “prime” Band A feeder category.

It was learnt the proposed hikes for Bands B and C categories of power consumers seek to align tariffs for customers in the categories with the N206/kW rate paid by Band A customers, who make up approximately 15 percent of the total 12.82 million power consumers nationwide.

Delivering his keynote address Thursday, Adelabu said the Nigerian Government would be considering this option over the slow pace of migration to Band A customers, which he attributed to the reluctance of distribution companies to make the necessary investments.

He, however, noted that the tariff regularisation would promote investments in the power sector amid calls by potential investors for a cost-reflective tariff regime in Nigeria.

Explaining the current tariff structure, the Minister further said consumers on Band B, who enjoy 18 to 17 hours of electricity supply, pay N63 per kilowatt-hour, while those in Band A, with only two hours more of supply, are charged N209 per kilowatt-hour.

He described this situation as 鈥渦nfair鈥� and stressed the need for a regularisation of the tariffs to create a more balanced and equitable pricing system.

鈥淲e will look at the tariff again. I am not saying that we are going to increase the tariff before I am misquoted.

鈥淲e are going to look at it and see how we can improve upon our modest achievement of last year, not only to ensure that we grow the sector that we need but also to ensure that we can invest more in revamping all these dilapidated infrastructure,” said he.

Adelabu stated: 鈥淭he migration to Band A should have been faster, but we found out that Discos refused to invest.

“They have refused to invest in this sector. A lot of investment is required for us to achieve an accelerated migration of lower-band customers into Band A. It is taking a lot of time.鈥�

Consumers: Profiteers raking revenues with limited investments in power generation

In regard to possible negative effects on small and medium enterprises in Nigeria, Dr. Femi Egbesola, President of Association of Small Business Owners of Nigeria (ASBON), said any further increase in electricity tariff would lead to the death of several small businesses in the West African country.

Dr. Egbesola told Vanguard that “majority of SMEs are dependent on electricity supplied by government and further hike in tariff will definitely lead to inflation, low sales necessitated by high cost of production, which may ultimately lead to ailing or death of some businesses, particularly micro and small businesses, which are the most vulnerable.”

In its reaction to the proposed electricity tariff hikes, the Education Rights Campaign (ERC), a CSO, said: 鈥淎ny thought of increment in electricity tariffs for any band of customers will be met by a determined mass resistance of the Nigerian people.鈥�

Nigerians should resist any increases in tariffs, says ERC National Coordinator

Hassan Taiwo, National Coordinator of ERC, reportedly said: 鈥淭he Federal Government should immediately forget about increasing electricity tariff.

“Any thought of increment in electricity tariff for any band of customers will be met by a determined mass resistance of the Nigerian people.

鈥淭his is for no other reason than the fact that as it stands today, power supply has not improved for the vast majority of the population who still suffer daily power cuts amidst other incidents of poor service delivery.”

Taiwo stated: 鈥淥ver the past one year, Nigeria has experienced almost bi-monthly incidents of collapse of the power grid.

“So, what would be the moral justification for an increase in electricity tariff for any band of customers more so non-Band A customers who occupy the lowest rung for consideration when it comes to the quality of service delivery by Electricity Distribution Companies, DISCOs.

“Aside from this, the Nigerian masses are yet to recover from previous increases.

鈥淎s it stands now, payment for electricity takes a significant chunk of people鈥檚 monthly income leaving them with very little to survive.”

The National Coordinator also noted: “Apart from individuals, many companies are folding up due to inability to meet the huge burden of electricity bills.”

“This extends to vital government institutions including hospitals.”

鈥淕oing by this tale of woes caused by previous increase, another electricity tariff hike risks triggering a shut-down of the whole country and it is for this reason that any further attempt to make life unbearable for the people by increasing electricity tariff will be resisted.鈥�

Tariff increments amid incidence of power grid collapse, by MSA

Likewise, the Movement for Socialite Alternative (MSA) said it had rejected any further hikes in electricity tariffs in the country.

Dagga Tolar, General Secretary of the group, was quoted to have said that MSA 鈥渉ad outrightly pointed out that the Band A鈥檚 apartheid discriminative increase in tariffs was a test-run to divide consumers against themselves, while falsely creating the impression that DISCOs have the capability of supplying 24 hours round the clock electricity for consumers.

“When in reality, what was at play was denying the rest of all of us our right to electricity to feed a few, who can pay.”

Tolar stated: 鈥淚nterestingly, this false has gained ground, with those abreast of the fact calling and insisting that 鈥淏and A鈥�, should be allowed to stay. But alas, with government now out to increase and Band A every consumer, the cat is out of the bag.

“The ruling class, which had privatised electricity for close to a decade-and-a-half, continued to be the major player, in terms of investments, with the private profiteers just raking billions of profit with little or nothing invested in generating additional megawatts for the country.”

The General Secretary of Movement for Socialite Alternative also related: 鈥淚n the past one year, the national grid collapsed over and over, with nothing done to remedy or prevent same from repeating itself.

“Even this on its own is enough judgment for the government to nationalise electricity supply under public ownership and democratic management of electricity workers, consumers and government.”

Tolar said: “Currently, electricity workers face the worst of working conditions, poverty wages, a majority of staff function as casual labour, with DISCOs refusing to respect any of the known labour laws of the land. It is clear we cannot continue like this.

“The (Bola Ahmed) Tinubu regime is proving to be in power to defend the interest of private profiteers and members of the billionaire club to the detriment of the welfare and well-being of working masses.”

He further noted: “From fuel to gas, telecommunication to electricity, food items, to rents. We witness an unending rise in prices.

“With inflation at double digit of 34 percent the working masses are left at the worst end.”

The Movement lamented: “To continue to agonise, without stepping out to organise a resistance will worsen the living conditions in t Nigeria. “We call on the working masses to independently begin to take necessary initiatives to organise and resist this paying for darkness to enrich the few.”

On N4 trillion debt to GenCos and new tariff system for Bands A, B and C

Chief Adelabu also disclosed that a new system is being proposed to encompass Bands A, B, C and eliminate D and E tariff groups would address these inequalities.

The Minister for Power noted: “The gap between the Band A tariffs and Bands B, C, D, and E is just too wide.

鈥淲e believe it鈥檚 not fair. It is not just, and we must be able to carry out some level of regularisation.鈥�

The Minister also revealed that the Federal Government owes electricity generation and distribution companies over N4tn in electricity subsidies.

According to him, the debt has added to the already challenging situation that should strengthen the power sector to deliver optimum service to consumers.

Analysis of the sum showed that N2 trillion is owed to GenCos as legacy debts, while another N1.9 trillion is owed the power providers as part of the electricity subsidy for 2024, while DisCos are owed N450bn for the 2024 electricity subsidy.

He asked: 鈥淗ow do you expect the GenCos to perform optimally?

Adelabu further quipped: “How do you expect them to pay for gas, service, and maintain their turbines and other infrastructure as well as pay their staff?

“If a total of N4 trillion is owed to them.”

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