WRITTEN BY: CHIOMA MADONNA NDUKWU
In a recent announcement, the Federal Government has hinted at additional electricity tariff hikes beyond the recent approval by the Nigerian Electricity Regulatory Commission (NERC).
Minister of Power, Adebayo Adelabu, disclosed during a briefing in Abuja that the current increase is just the beginning of a phased-out subsidy removal plan. Adelabu emphasized the government’s intention to transition to a fully cost-reflective tariff over a three-year period, citing the need to encourage investment in the power sector.
The Minister clarified that the tariff adjustments are a pilot initiative, with Band A customers experiencing the initial changes. He highlighted the unsustainable nature of electricity subsidies, which previously accounted for 67% of the sector’s costs, amounting to a significant burden on the national budget. The government aims to gradually shift from subsidy reliance to a more sustainable pricing model, prioritizing customers with reliable infrastructure.
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