The Federal Government has revealed plans to standardize electricity tariffs in an effort to address inconsistencies in the current billing system and promote investment in the power sector.
The Minister of Power, Adebayo Adelabu, disclosed this during the ongoing public presentation of the National Integrated Electricity Policy and Nigeria Integrated Resource Plan on Thursday in Abuja.
He explained that the government is considering this option due to the slow pace of migration to Band A customers, which he attributed to the unwillingness of Distribution Companies to make the necessary investments.
Under the existing structure, customers in Band B, who receive 18 to 17 hours of electricity supply, are charged N63 per kilowatt-hour, while those in Band A, with just two more hours of supply, pay N209 per kilowatt-hour.
Adelabu described this as “unfair” and emphasized the need for tariff regularisation to establish a more balanced and equitable pricing system.
The minister stated, “We will look at the tariff again. I am not saying that we’re going to increase the tariff before I am misquoted.
“We are going to review it and see how we can improve upon our modest achievement of last year, not only to ensure that we grow the sector that we need but also to ensure that we can invest more in revamping all these dilapidated infrastructures.”
“The migration to Band A should have been faster, but we found out that the DisCos refuse to invest. They have refused to invest in this sector.
“A lot of investment is needed for us to achieve an accelerated migration of lower-band customers into Band A. It is taking a lot of time.”
In response, the government is considering restructuring the tariff bands to narrow the current significant gap between them.
A new system, proposed to include Bands A, B, and C, would address these disparities.
“The gap between the Band A tariffs and Bands B, C, D, and E is just too wide,” he remarked. “We believe it’s not fair. It is not just, and we must be able to carry out some level of regularisation.”
He added that the government is committed to reviewing the current tariff structure but quickly clarified that the review does not suggest an imminent rate increase.
