The Federal Government has announced plans to regularize electricity tariffs in order to address existing disparities in the current billing system and foster investment in the power sector. The Minister of Power, Adebayo Adelabu, revealed this during the public presentation of the National Integrated Electricity Policy and the Nigeria Integrated Resource Plan in Abuja on Thursday.
Adelabu explained that the government is exploring this option due to the slow pace of migration to Band A customers. He attributed this slow transition to the reluctance of Distribution Companies (DisCos) to make the necessary investments in the power sector.
Under the current tariff structure, customers in Band B, who receive 17 to 18 hours of electricity daily, pay N63 per kilowatt-hour, while those in Band A, who enjoy just two extra hours of supply, are charged N209 per kilowatt-hour. Adelabu called this pricing system “unfair” and emphasized the need to regularize tariffs to create a more equitable pricing structure.
The minister clarified that the government is not planning an immediate tariff hike, but instead intends to review and improve upon the achievements of the previous year. He acknowledged the need for substantial investments to revamp dilapidated infrastructure and speed up the migration of lower-band customers to Band A.
The government is considering restructuring the tariff bands, with a proposal to create a more balanced system encompassing Bands A, B, and C. Adelabu pointed out that the current gap between Band A tariffs and the lower bands (B, C, D, and E) is too wide and unfair. He assured that the government remains committed to reviewing the tariff structure while maintaining a focus on fairness and sustainability in the power sector.
