Adebayo Adelabu, the Minister of Power, has said that the electricity tariffs for Band A customers could decrease if the exchange rate falls below N1,000 to a dollar, News About Nigeria reports.
He made this statement during an appearance on Channels Television’s Politics Today on Thursday.
Following the Federal Government’s decision, announced by the Nigerian Electricity Regulatory Commission (NERC) on April 3, to discontinue subsidies for Band A customers, the tariff for this category of consumers was raised from N68/kWh to N255/kWh, while tariffs for other bands remain unchanged.
Explaining the concept of kilowatt-hours (kWh) and the tariff adjustments, Adelabu said that 1 kWh represents the amount of energy consumed by a 1,000-watt appliance in an hour.
He said that the current tariff, even for Band A customers, remains more economical compared to the cost of fuel.
Adelabu said that the tariff is flexible, adding that a reduction in the exchange rate below N1,000 to a dollar would positively impact the tariffs.
“The tariff is flexible. I can tell you if the naira gains more and the exchange rate comes down below N1,000 to a dollar, it must positively affect the tariff; and the tariff, even for Band A, will come down below the N225/KWh that we are currently charging.
“There are variable factors that go into the composition of the tariff, and we are not closing our eyes to it. We are publishing it, we are transparent, we are talking to Nigerians and all the power sector stakeholders. This administration is very serious, and we are committed to transforming the sector,” Adelabu said.
Addressing the challenges in the power sector, Adelabu acknowledged that the issues had been accumulating over the past 50 years and could not be resolved overnight.
However, he assured that consistent and gradual progress is being made.
Furthermore, the minister revealed ongoing efforts to upgrade customers in other bands to Band A as power generation improves over the next six months.
Meanwhile, the administration of President Bola Tinubu has faced criticism over the recent electricity tariff hike, with various groups and individuals calling for a reversal of the decision.
