The Federal Government has announced that it expects to save N1.5 trillion this year following the recent hike in electricity tariff for Band A customers to N1.5 trillion. Additionally, about 2.5 million meters are set to be installed this year to bridge the metering gap across the country and ensure consumers pay the correct amount for electricity.
The Special Adviser to the President on Information and Strategy, Bayo Onanuga, stated that the government’s move to withdraw electricity subsidy from 15 percent of power consumers in Nigeria would save about N1.1 trillion annually.
However, in a document from the Federal Ministry of Power, it was revealed that the recent tariff adjustment would result in even greater savings of N1.5 trillion for the government. The adjustment is aimed at improving liquidity in the Nigeria Electricity Supply Industry (NESI), and power distribution companies will face sanctions for supplying less than 20 hours of power to Band A consumers.
Last week, manufacturers and organized labor opposed the tariff hike payable by about 1.9 million consumers, which the Federal Government approved. The hike, which took effect on April 3, 2024, saw an increase in the tariff from N68/kWh to N225/kWh for Band A customers, representing about a 240 percent increase.
Meanwhile, the power ministry stated that the Federal Government aims to meter about 2.5 million unmetered power users annually. The Presidential Metering Initiative seeks to close the metering gap within the next three to five years, aiming for transparency and objectivity in the billing system and ultimately eliminating estimated billing by the end of 2024.
