The Federal Government of Nigeria has unveiled plans to save a sum of N1.5 trillion and install 2.5 million meters across the nation, following the recent hike in electricity tariffs.
The decision to withdraw electricity subsidies from 15% of power consumers, categorized under Band A, is expected to contribute to annual savings of about N1.1 trillion, according to the Special Adviser to the President on Information and Strategy, Bayo Onanuga.
In a statement released on April 2, 2024, Onanuga highlighted the administration’s commitment to allowing the price hike in electricity, citing a substantial budget of N450 billion allocated for energy subsidies in 2024 under the leadership of President Bola Tinubu.
Recent documents from the Federal Ministry of Power, shared by the media aide to the power minister, Bolaji Tunji, outlined the government’s intention to achieve savings of N1.5 trillion through the tariff adjustment.
The ministry emphasized ongoing subsidies for customers below Band A, stating that power distribution companies failing to provide a minimum of 20 hours of power supply to Band A consumers would face sanctions.
Despite opposition from manufacturers and organized labor, the government proceeded with the tariff hike, affecting approximately 1.9 million consumers.
This increase, announced by the Nigeria Electricity Regulatory Commission, saw affected consumers paying N225 per kilowatt-hour, marking a substantial 240% rise from the previous rate of N68/kWh.
The Federal Government unveiled plans to address the metering gap, with a target of metering about 2.5 million unmetered power users annually through the Presidential Meter Initiative.
The initiative aims to eliminate estimated billing and ensure transparency and objectivity in the billing system by installing a minimum of 2 to 2.5 million meters yearly over the next five years.
As per a September 2023 report by the Nigerian Electricity Regulatory Commission (NERC), out of the total 12,825,005 registered electricity customers, only 5,707,838 had meters, leaving over 7.1 million customers subjected to estimated billing.
Minister of Power, Adebayo Adelabu, reiterated the government’s commitment to closing the metering gap within three to five years, emphasizing the necessity of achieving this target to guarantee stable power supply for citizens.
