The Nigerian Electricity Regulatory Commission (NERC) has officially cleared the air, dismissing widespread rumours of an increase in electricity tariffs starting January 1st, 2024.

Reports have been rife that  Nigeria’s electricity distribution companies (DisCos) are planning to increase electricity tariffs nationwide with effect from January 1, 2024.

According to the reports, “All has been perfected for the new tariff to take effect from the first of January, 2024”.

Another report said “NERC held a meeting with all DisCos this morning. They are going to reset tariffs Monday morning 01st January. Consumers should expect tariffs to double.However, when contacted NERC spokesman, Dr. Usman Arabi, told LEADERSHIP that the tariff hike rumours was fake news.Also, he categorically denied any approval for such a tariff hike, emphasising that the electricity tariff order currently in effect remains unchanged.“NERC has not issued any order to DisCos concerning tariff hike; we usually have meetings with all stakeholders before any proposed increase, but we’ve not had any meeting with any DisCos concerning price increase,” Abba said BusinessDay, on Sunday afternoon.Recall that in November, 2023, the minister of Power, Adebayo Adelabu, said that President Bola Tinubu stopped the implementation of a hike in electricity tariff and insisted that subsidy be paid on power consumed nationwide.

Adelabu said then that “Tariffs should have been raised months back, but Mr President said until we are able to achieve regular and incremental power supply we can’t touch the tariff.”But for political reasons and empathy, you cannot cause additional burden on Nigerians. We just had the removal of the fuel subsidy, we are talking about the exchange rate skyrocketing, galloping inflation and so many others that bring hardship to the people.”And Mr President is trying to relieve this hardship through various forms of palliatives. So it is not politically expedient and reasonable to now implement a tariff that is more like dumping the existing tariff.We are now paying about N70 (per kilowatt-hour), and it can never be less than N130 or N140 at the exchange rate of today if we are to implement a cost reflective tariff. Because part of the reasons for an increased tariff is the price of gas, which is paid in dollars,” Adelabu stated.

Experts said the above development indicates rising electricity subsidies for Africa’s biggest economy.Adetayo Adegbemle, the executive director of PowerUp Nigeria, a power consumer advocacy group said bridging the gap between the cost-reflective tariff and the allowed tariff, has become a significant burden on government finances, raising concerns about its sustainability.

Source: Leadership