A progressive change in electricity rates will be implemented by Nigeria’s federal government within upcoming months according to its power sector revitalization plan. Nigeria announced this news at a time when the nation seeks to implement its $32 billion program aimed at achieving nationwide electricity access by 2030.
Olu Verheijen who serves as President Bola Tinubu’s Special Adviser on Energy spoke at the Africa Heads of State Energy Summit in Tanzania about the requirement to combine cost-reflective pricing methods with social protection systems. The government is building a new pricing system that brings in private capital investments yet shields vulnerable consumers from excessive costs according to Verheijen.
The Nigerian Electricity Regulatory Commission (NERC) introduced major tariff increases to Band A customers through reforms enacted in April 2024 which elevated rates from N68 KWh to N225 KWh before the commission adjusted it to N209.50 KWh. The electricity rate adjustment increased to N209.50 while affecting consumers who comprise about 15% of the total market.
Different parties within the industry sector have presented contrasting viewpoints on the proposed modifications.
Kunle Olubiyo, who leads the Nigeria Consumer Protection Network expressed doubts regarding how additional tariffs would enhance service quality. The sector maintains inadequate power production for Nigeria’s citizens even after the power sector implemented more than 500% of cumulative tariffs from privatization until the present day according to Olubiyo’s assessment.
The Nigerian power sector operates at a generation capacity deficit because the installed power generation currently stands at 6,000 megawatts which does not satisfy national requirements. The government has implemented a reform plan to fix infrastructure deficiencies through strategic management of fees against economic accessibility.
Adetayo Adegbemle as Powerup Convener analyzed the planned changes to indicate a departure from standard subsidies. He stated that the government plans to implement the right pricing by maintaining targeted support through the first 50-kilowatt monthly consumption subsidies for qualifying consumers.
The reform initiative emerges at a critical time when distribution companies in Nigeria request operational cost-based tariff structures to relieve their growing debt burden. The government implements a soft transition plan which protects consumers especially poorer families while supporting industry sustainability.
The power sector transformation in Nigeria requires achieving the proper equilibrium between private investment attraction infrastructure improvement and affordable electricity access for a growing population.
