Nigeria’s Electricity Tariff Hike: Understanding the Recent Increase


The Nigerian Electricity Regulatory Commission (NERC) recently approved an increase in electricity tariff for customers under the Band A classification, raising it from N66 to N225 per kilowatt-hour. This move, affecting customers who enjoy 20 hours of electricity supply daily, is part of efforts to attract new investment and reduce the $2.3 billion spent to cap tariffs.

NERC’s Vice Chairman, Musliu Oseni, clarified that this increase impacts only a small percentage (15%) of the total 12 million electricity customers in the country. He also noted that some customers have been downgraded from Band A to Band B due to the non-fulfillment of required hours of electricity provided by distribution companies.

While the tariff review does not affect customers in other bands, it signifies a significant change for those in Band A. The increase in electricity prices is aimed at improving the sector’s viability, encouraging investment, and ultimately providing more reliable electricity to Nigerians.

This development comes in the wake of an announcement by the Nigerian Midstream and Downstream Petroleum Regulatory Authority of an increase in the price of natural gas, which is used to generate more than 70% of electricity in Nigeria. These changes highlight the complexities and challenges facing the Nigerian energy sector and the government’s efforts to address them.

As the country navigates these changes, it is crucial for stakeholders to engage in constructive dialogue to ensure that these decisions lead to tangible improvements in the electricity sector and ultimately benefit all Nigerians.

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