Minister Hints on Electricity Tariff Decrease When Naira Exchange Rate Improves to N1,000/$1
- The minister of power has forecast a reduction in the electricity tariff rate paid by customers on Band A
- He hinted that any adjustments to tariffs would be hinged on fluctuations in foreign exchange rate
- Adelabu said FG plans to upgrade more customers to Band A as power generation improves over the next few months
PAY ATTENTION: The 2024 Business Leaders Awards Present Entrepreneurs that Change Nigeria for the Better. Check out their Stories!
Legit.ng journalist Victor Enengedi has over a decade's experience covering Energy, MSMEs, Technology and the stock market.
Minister of Power Adebayo Adelabu has stated that the N225 per kilowatt-hour tariff for Band A electricity consumers might see a reduction should the exchange rate drop below N1,000 to a dollar.
Adelabu said this on Thursday, April 11, 2024, as a guest on Channels Television's Politics Today programme.
Source: UGC
This statement follows the recent decision by the federal government, executed through the Nigerian Electricity Regulatory Commission, to discontinue subsidies for Band A customers, who now face a tariff of N255/KWh, while other consumers maintain their previous rates.
PAY ATTENTION: Сheck out news that is picked exactly for YOU ➡️ find the “Recommended for you” block on the home page and enjoy!
Tariff decrease anticipated
Adelabu underscored that despite the tariff increase, Band A rates remain lower than fuel costs and hinted that any adjustments to tariffs would hinge on fluctuations in the exchange rate.
He said:
“The tariff is flexible and I can tell you that even if naira gains more and the exchange rate comes down below N1,000, it must positively affect the tariff and the tariff even for the Band A will come down below the N225 kilowatt per hour that we are currently charging.”
The minister highlighted the potential for positive changes in the tariffs paid by Nigerians, attributing this to the reduction of inefficiencies among sector operators and the strengthening of the naira against the dollar.
More customers to be added to Band A
Adelabu acknowledged the enduring challenges within the power sector, emphasising that progress necessitates dedicated time and effort.
He said there are plans to elevate customers to Band A status as power generation capacity improves over the ensuing six months.
Adelabu also mentioned the government's vigorous efforts to elevate power generation from approximately 4,000 megawatts to 6,000 megawatts within the same timeframe.
Nonetheless, the recent increase in electricity tariffs has triggered criticism of the administration, prompting calls for a reconsideration of the decision.
NERC issues fresh instructions to DisCos
Meanwhile, Legit.ng also reported that NERC has sent a directive to DisCos regarding the execution of the April 2024 Multi-Year Tariff Order.
In a statement issued on Saturday, NERC emphasised that the commission has instructed all DisCos to offer maximum clarity to all impacted customers.
It highlighted that all DisCos must promptly publish the schedule of approved Band A feeders affected by the rate review on their websites.
PAY ATTENTION: Donate to Legit Charity on Patreon. Your support matters!
Source: Legit.ng
