The Minister of Power, Sale Mamman has said that the government is not planning a fresh increase in electricity tariff in the immediate terms contrary to reports in the media recently.
According to the minister, instead of a significant hike in electricity tariff, Nigerians should expect increased efficiency in the sector to reduce tariff, while managing headwinds from foreign exchange and inflation.
The clarification came amidst reports of a possible major increase in the tariff payable by electricity consumers nationwide beginning from July this year.
A statement by the minister in Abuja, stated that the order by the Nigerian Electricity Regulatory Commission (NERC) on April 26, 2021, titled “Notice of Minor and Extraordinary Review of Tariffs for Electricity Transmission and Distribution Companies,” was a routine procedure.
He said the review being planned by the NERC was in accordance with Section 76 of the Electric Power Sector Reform Act of 2005.
“The tariff for customers on service bands D and E (customers being served less than an average of 12 hours of supply per day over a period of one month) remains subsidised in line with the policy direction of the Federal Government.”
He said Section 76 of the Electric Power Sector Reform Act of 2005 provided clear guidelines for the periodic review of tariff based on market data and submissions from licensees.
The guidelines include the provision that the Commission shall give notice of activities related to tariff. The Multi-Year Tariff Order (MYTO) per NERCs regulation obtains inputs from operators in the market every 6 months to perform minor reviews and a major review is required.
Mamma noted that the Buhari administration remains faithful to the adopted resolutions from the Joint FGN-NLC/TUC Technical Committee on Electricity Tariffs which makes recommendations for “NERC to conduct an extraordinary review of the MYTO to further review factors and align them with current
“Government is committed to increasing supplied energy to the grid through rapid expansion of infrastructure through the various facilities for the sector either to the DISCOS under strict terms or to the Transmission Company of Nigeria.
“Furthermore, the National Mass Metering Program is on course to reduce losses. To date more than 500k meters have been delivered to DISCOs in phase 0 of the program in 5 months (this exceeds the progress done for the entire MAP scheme).
“We will eliminate the metering gap during the life of this administration. This administration is not unaware of the challenges that Nigerians face which is why govt has continued to subsidise the band D and E consumers to pre-Sept 2020 rates (55 percent of grid connected customers).”