As the new electricity tariff continues to generate controversy amongst the people, owing to the epileptic power supply in recent times, Adebayo Adelabu, the Minister of Power, while featuring on Channels Television’s Politics Today on Thursday, disclosed that if the exchange rate falls below N1,000 to a dollar, the N225 kilowatt-hours being paid by electricity consumers on Band A will reduce.
The Informant247 reports that the Federal Government, through the Nigerian Electricity Regulatory Commission (NERC), has approved a new tariff, which is expected to reduce subsidies for the 2024 fiscal year by about N1.14 trillion.
According to a statement by Mr Musliu Oseni, the Vice Chairman, NERC on Wednesday, in Abuja, ”With the newly approved tariffs, subsidies for the 2024 fiscal year are expected to reduce by about NGN1.14 trillion in furtherance of the Federal Government’s realignment of the subsidy regime.”’ he said.
Oseni said that the Federal Government had indicated a transition in policy direction towards introducing a more targeted subsidy regime aimed at mitigating the impact of changes in macroeconomic parameters.
However, the minister, while answering questions being asked, said the amount being paid by the Band customers is still cheaper than the amount being spent on fuel.
He said, “The tariff is flexible. I can tell you if the naira gains more and the exchange rate comes down below N1,000 to a dollar, it must positively affect the tariff, and the tariff, even for Band A, will come down below the N225/KWh that we are currently charging.
“There are variable factors that go into the composition of the tariff, and we are not closing our eyes to it. We are publishing it, we are transparent, we are talking to Nigerians and all the power sector stakeholders. This administration is very serious, and we are committed to transforming the sector.”
“The problem we are having is an accumulated problem of over 50 years. It will not disappear in one year, but we’ve been making consistent and gradual progress,” he added.
The minister stressed that efforts are ongoing to upgrade customers on other bands to Band A as power generation improves in the next six months.