Breaking: NERC Increases Electricity Tariff For Band A Customers

By Sunday Etuka, Abuja

The Nigerian Electricity Regulatory Commission (NERC) has jerked up the electricity tariff for “Band A” customers from N68 kwh to N225kwh.

NERC Chairman, Sanusi Garba announced the development during a Press Briefing on Wednesday, April 3, 2023, in Abuja.

TheFact Daily reports that the “Band A” Customers are those who get up to 20 hours of electricity supply per day.

It should be noted, however, that there is no increment of tariffs for customers in Band B, C, D, and E respectively.

By computation, the Band A tariff customers enjoy 20 hours and above of electricity supply daily, Band B a Minimum of 16 hours but less than 20 hours, Band C a Minimum of 12 hours but less than 16 hours, Band D a minimum of 8 hours but less than 12 hours and Band E, less than 8 hours.

Engr.  Garba who was represented by the Vice Chairman, Musliu Oseni said, the Band A customers will now pay N225kwh, from the previous band tariff of N66kwh.

He also disclosed that 300 of the 800 feeders that are categorised as Band A are not qualified to be in that group, consequently, would be downgraded.

“We currently have 800 feeders that are categorised as Band A, but it will now be reduced to under 500. This means that 17 percent now qualify as Band A feeders. These feeders only service 15 percent of total electricity customers connected to the feeders.

He announced that “the commission has issued an order which is titled April supplementary order and the commission allows a 225 kilowatt per hour”.

NERC said, the increment was due to the recent hike in the price of Gas, adding that about 75% of the nation’s total power generation is from gas fired thermal power plants, and that the Commission has the obligation effect tariff review in such situation.

Recall that the the government, through the Nigerian Mainstream and Downstream Petroleum Regulatory Authority (NMDPRA) on Monday, April 1, 2024, increased the gas price from $2.18 to $2.42 per Million British Thermal Unit (MMBTU).

The decision, according to NMDPRA, was in line with the provisions of the Petroleum Industry Act (PIA) 2021 assented to by the President on the 16th of August 2021 and gazetted on the 27th of August 2021 that provided a clear regulatory framework for the determination of a market-based pricing regime for the domestic gas market in Nigeria.

Even though the NMDPRA maintained that the new domestic base price was arrived at after due consultation with key stakeholders, the electricity consumers may have been excluded the arrangement, as they are already lamenting the upward review of the price.

Speaking on the development on Arise Television, the Former Chairman of NERC, Dr. Sam Amadi said, “the tariffs that we pay as electricity consumers are a build-up from gas supplier. It is a value chain tariff. From gas suppliers to generators, to transmission and distribution, that is what we pay, so usually, gas could be up to 40% of the cost component.

“When the cost of gas increases, the regulator (NERC) has Minor or Major review to make. Increment in gas, inflation, exchange rate will trigger reindexing of previous or current price base on these fundamentals”, he said.

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