By Elizabeth Chukwuma
Peter Obi, a former governor of Anambra state and the erstwhile Presidential Candidate of the Opposition Labour Party, LP, in the February 25, 2025, Presidential election may have taken advantage of his visit to the North eastern state of Bauchi on the invitation of Senator Bala Mohammed, the state governor, to commission a Borehole project in in Sabon Layi Community on the outskirts of the Bauchi, the state Capital to speak out about President Bola Ahmed Tinubu’s government decision to withdraw further payment of electricity subsidy and the subsequent increase of increase in price of electricity bill for consumers on category Band A.
Obi, the former Anambra state governor may have taken advantage of the high level of poverty at the Bauchi state Community which is a clear evidence of what obtains in the other 35 states of the Federation, including Abuja, the Federal Capital Territory, FCT, to suggest that that ‘’there is need for a concentrated by the government to generate more power rather than raising electricity tariff that will ‘’impact negatively on small businesses and the country’s economic growth’’.
The Nigerian government may have taken up the challenge of the LP, erstwhile Presidential Candidate Serious as it has set a target to increase the country’s power generation from the current 4,000 to 6,000 megawatts in the next six months. Adebayo Adelabu, minister of Power, who had volunteered the information on Monday, April 8, 2024, while meeting with the Heads of the agencies under the ministry and other industry stakeholders had said that the current 4,000 megawatts being generated in the country is no longer acceptable . ‘’We plan to increase the country’s power generation to a minimum of 6,000 to 6,500 megawatts in the next three to six months’’, the minister had said.
He may have been convinced that the country’s power generating companies have the installed capacity to generate 6,000 to 6,500 megawatts of electricity daily based on what he saw on ground in a number of the power generating companies visited recently across the country. He had said that a large percentage of the country’s power installed capacity is operational but lamented that they are not available because of low and shortage of gas supply.
Back to the electricity tariff hike, Obi, who is an apostle of Free Trade regime, had argued that ’’if there is absolute necessity for an increase in electricity tariffs , it should be target at individuals who have the financial wherewithal, rather than over burdening the poor’’ who are already struggling on a daily basis for survival.
Musilu Oseni, Vice Chairman of the National Electricity Regulatory Commission, NERC, had said that the increase in the country’s electricity tariff will see the consumers in the category labeled Band A, will pay N225 for each kilowatt of electricity used per hour from the initial N66.00.
The Presidency had said that the electricity tariff increase as proposed by NER, was approved in a bid to attract more investments to the nation’s power sector and slash the North American country of the United States, US, $2.3 billion spent to subsidize electricity supply in the country, thus making possible for Nigerians have to pay $2.42 per one million British Thermal units from the previous rate of $2.18 MTU.
Yusuf Ali, the Head of NER, Planning, Research and Strategy, had said that the agency had bowed to pressures from the Licensees, which are the distribution companies, Discos, and which had written the Management of the agency a letter in July 2023, that they want a new tariff due to the fluctuation of the naira to the US dollar, which is the major currency of international transation payments in both the official and the Parallel, popular Black market.
As a prelude to fixing the new electricity tariff, he had said that ‘’for one week in the month of July, 2023,the two parties held rate case hearings which he had said was in inline with international best practices to arrive at the April 3l, 2024, figure.
Given an insider information on how the present electricity tariff was set, he had told those that cares to listen that some consumers were invited to participate in the discussion on the proposal by the distribution companies
The NER Commissioner may have shocked Nigerians when he disclosed that, the new electricity tariff is‘’cost reflective’’. He had said that the agency was encouraged to expedite action in settling the issue of the electricity tariff problem with the DisCos, because the government, had made it categorically clear that ‘’it will be unwilling to pay subsidy for electricity consumption n the country as it could no longer be accommodated in its budgetary allocation because of other pressing competing needs like provision of basic infrastructural facilities in the country.
The government may have given the impression that by taking such a bold decision, which many had likened as the government acting out the script of the World Bank which has Ajay Anga as the President and the IMF, under the Leadership of Kristalina Georgieva and which were instrumental for the removal of petrol subsidy and unification of the country’s Autonomous Foreign exchange and Parallel, popular Black market foreign exchange rates will save the country N1.14 trillion, which is over four percent of this year’s N27 trillion budget.
He had admitted that ‘’there is some pains that comes with the electricity tariff adjustment which energy analysts had said has made Nigeria, the most populous country in the African Continent one of the few countries around the world that could be said to have had ‘’the highest prepaid metering charges’’.
The NER Vice Chairman, had said that there was no need for Nigerians not worry about the tariff increase as the customers affected only represent a mere 1.5 percent or 12 million people of the country’s electricity consumers. He had revealed that given that not all the consumers in the Band A, category could pay the new electricity tariff had forced the agency to take the bold initiative to downgrade some of the customers over alleged non-fulfilment of the required hours of electricity provided by the electricity distribution companies.
Giving an insider information on the number of feeders used to serve the electricity consumers in the Band category for now that had made it possible for the agency its electricity tariff, the NER, Chief Executive Officer, CEO, who had been under intense criticisms by Nigerians for taking the wrong decision had confirmed that the agency currently have 800 feeders that are serving them. He had said that that it will be reduced to 500 only 17% of the electricity consumers in the Band A, only qualify to to enjoy the facility.
Angered by the recent NERC, electricity tariff hike for consumers on Band A, which Femi Falana, a Senior Advocate of Nigeria, SAN, had said cannot be justified by the government going by the 2023, electricity Act, may have informed why he has threatened to head to the Court ‘’to seek redress for Nigerians’’.
The Lagos based SAN , had argued that the government had no basis’’ to increase the country’s electricity tariff again as the previous Administration of former President Muhammadu Buhari had already removed the so- called electricity subsidy in 2022. He was emphatic that ‘’electricity subsidy is non –existent’’ in Nigeria alleging that that the Tinubu’s government is just looking for ways’’ to raise funds for the cash-strapped electricity Managers in Nigeria, which are the Discos’’.
Given a rough calculation , the SAN, had said the electricity tariff increase for consumers in the Banda A, category , will only fetch the government and the Discos, N1.6 trillion, noting that the N3 trillion revenue target may not be achieved . He had asserted that this may encourage the government to extend the electricity tariff increase to the other Bands so that the balance N1.4 trillion will be recovered.
He had revealed that the government had increased the country’s electricity tariff in the recent time ‘’to forestall the takeover of the cash-strapped Discos, by Banks owed and AMCON, and which have no competence to run electricity companies. Nigerians are watching to see how the unpopular policy on electricity tariff hike case would end in Court.
