The Nigerian government’s contemplation of a planned electricity tariff increment, set to take effect from July 1, has sparked a wave of uncertainty among the populace.
The proposed increase, aimed at aligning electricity tariffs with the country’s economic realities, has left Nigerians concerned about the potential impact on their already strained financial situations.
Over the past three years, Nigeria has witnessed several upward adjustments in electricity tariffs, reflecting inflation rates and the exchange rate of the Naira. However, conflicting reports and denials from various stakeholders have created confusion surrounding the imminent tariff hike.
The Abuja Distribution Company (AEDC) recently denied rumors of an impending tariff increment, stating that the Nigerian Electricity Regulatory Commission (NERC) had yet to approve any changes.
According to Mr. Michael Faloseyi, Assistant Manager of Public Affairs at NERC, the commission has not granted authorization for a tariff increase.
However, an anonymous industry stakeholder has insisted that the increment is still likely to be implemented by July 1, despite the denial by the DisCos. The stakeholder suggested that pressure from behind may be influencing the DisCos to delay announcing the tariff increase, emphasizing that the denial does not necessarily mean the increment won’t occur.
“The denial does not mean that it will not be implemented; it is just information management. It means that the increment would likely take place but may not be the percent increase making the rounds,” said a former spokesperson for one of the DisCos.
Economic experts have expressed concerns about the implications of the proposed electricity tariff hike. Idakolo Gbolade, CEO of SD & D Capital Management, warned that such an increment would further weaken the purchasing power of Nigerians.
Gbolade called upon the government to shelve the tariff increment in the national interest, considering the ongoing challenges faced by the populace due to fuel subsidy removal and the devaluation of the Naira.
Professor Segun Ajibola, former President and Chairman of the Council of Chartered Institute of Bankers of Nigeria, emphasized that any tariff increase must be accompanied by improved service delivery from the Generation and Distribution Companies.
He urged the government to address the current state of power infrastructure in the country, ensuring that Nigerians receive value for their money.
The Nigerian Labour Congress (NLC) has also voiced opposition to the proposed tariff hike, with spokesperson Benson Upah stating that workers have already made their position known to the government. Upah called on the government to do everything possible to shelve the planned increment.
Furthermore, Mr. Kunle Olubiyo, President of the Network of Energy Reforms Nigeria, expressed skepticism about the DisCos’ commitment to the tariff increment, deeming it insensitive at this time. Olubiyo stressed the need for a comprehensive review of pricing methodologies and templates, including gas pricing in Naira.
He also highlighted the importance of supporting indigenous prepaid meter manufacturers to improve access to meters.
As Nigerians await a final decision on the impending electricity tariff increment, the uncertainty surrounding the issue continues to fuel anxiety and concern. Stakeholders, including experts, labor unions, and consumer protection advocates, are calling for transparent communication, improved service delivery, and measures to alleviate the burden on Nigerians during these challenging times.
The government faces the delicate task of balancing economic growth with the immediate welfare of its citizens.
In the interim, Nigerians hope for a resolution that will ease the financial strain and pave the way for a more sustainable and accessible electricity sector in the long run.
