The Bola Tinubu administration is set to increase electricity tarrif by 300 percent to reduce government spending since it can no longer afford the huge amount it pays to subsidise electricity yearly.
A report by Bloomberg on Tuesday disclosed that electricity companies in Nigeria will soon have the government’s say-so to hike tariffs from N68 per kilowatt-hour to N200 per kilowatt-hour for urban consumers in April.
Urban consumers occupy about 15 percent of the population and consume 40 percent of the nation’s energy, the report said.
The report was based on conversations with multiple government officials who were not authorised to speak publicly on the matter.
Presidential aide Bayo Onanuga, who said it would be premature to comment on the matter, stated that the official regulator, the Nigerian Electricity Regulatory Commission, would communicate feedback and necessary developments to the public.
“The regulator will make any pronouncements based on its discussion with the distribution and generating companies. The presidency cannot say anything at this stage,” Onanuga told the media.
With only urban consumers affected, Tinubu will now only continue to subsidise electricity tariffs for people in rural areas.
In February, Minister of Power Adebayo Adelabu said that the federal government could no longer shoulder the burden of subsidising energy for Nigerians, noting that the government’s power debt to generating companies had ballooned to more than 1.3 trillion naira.
Since Adelabu assumed office last year, he has been clamouring for the government to scrap the electricity subsidy to reduce the debt burden of the power ministry, which he said was not sustainable for the sector.
It is unclear exactly how the citizens will react to the planned hike, as the majority of them have yet to recover from the suffering triggered by fuel subsidy removal last year.
