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FG Sets For Fresh Hike In Electricity Tariff
The Minister of Power, Adebayo Adelabu, has stated that the federal government is working on transitioning to a cost reflective tariff to stop an increase in the N4trn debt it owes the sector.
The minister who spoke during the Mission 300 Stakeholders’ Engagement meeting in Abuja, said this is part of reforms to set the power sector on the path of sustainability and bankability.
It would be recalled that despite the increase of electricity tariff for Band A customers, electricity consumers have complained of low electricity supply and continuous payment of faulty electricity installation.
But Adelabu said the decision is critical to the economic growth and development of Nigeria.
“Currently, there’s a huge outstanding debt to the power generation companies in the form of unpaid government subsidies which stands at about N4trn as of December 2024.
“The Federal Government is already working out modalities to defray this obligation and to ensure that further obligations are not accrued going forward, the government is working on a plan to transition the sector to a fully cost-reflective regime while implementing targeted subsidies for the economically vulnerable citizens in the country.”
The implication of this is that the government would end the subsidy regime in the electricity sector which would trigger an increase in tariff across board.
Report says government had accrued N1.1tr as subsidy payment in the first six months of 2025 making its debt climbing to N5tr.
The minister in a statement by his media aide, Bolaji Tunji, said improving power generation through recovery of idle capacities and expanding energy mix to ensure energy security and to dilute the power pool with cheaper and cleaner energy sources would be a priority.
He announced the priorities of the government in power sector reforms to include “addressing the market liquidity issues and initiating required sector reforms”.
“Other areas included expanding transmission infrastructure to deliver more power, ensuring stability of the national grid to put an end to several grid disturbances and collapses previously observed on the grid, and to further strengthen the coordination and management of the national grid.
The Minister also said that the ministry is pursuing increased renewable energy through its rural electrification and energy transition drive, to provide a reliable power supply to unserved and underserved communities.
He said the stakeholders meeting would provide an opportunity for them to align, strategize, and to build the partnerships needed to move from Nigeria Energy Compact, to concrete results, as he called on development partners, the private sector, philanthropic actors, the public sector, and the civil society organizations to rally around this mission.
The Minister of Finance, Chief Wale Edun, who spoke through zoom from Brazil also said that the reforms the government was undertaking in the power sector were critical towards unlocking the full potentials of the economy as it would lead to job creation. He said the reforms have led to over 40 percent increase in power distribution in the first quarter of 2025.
Cost reflective tariff versus allowed tariff
The cost reflective tariff for Band A – Non-MD customers is N231.79 while the allowed tariff is N209.50, Band A – MD1, cost reflective tariff is N225.90 while allowed tariff is N209.50 similarly, cost reflective tariff for Band A – MD2 is N220.01 while allowed tariff is N209.50.
For Band B – Non-MD, cost reflective tariff is N223.94 while allowed tariff is N68.96; Band B – MD1 cost reflective tariff is N220.01 while allowed tariff is N67.18, Band B – MD2, cost reflective tariff tariff is N216.08 while allowed tariff is N67.12.
For Band C- Non-MD, cost reflective tariff is N209.32 while allowed tariff is N56.38; Band C-MD1 cost reflective tariff is N200.37 while allowed tariff is N54.64 and Band C – MD2 cost reflective tariff is N200.37 while allowed tariff is N54.64.
Band D – Non-MD cost reflective tariff is N164.34 while allowed tariff is N39.67; Band D – MD1 cost reflective tariff is N207.67 while allowed tariff is N55.4; Band D – MD2 cost effective tariff is N207.56 while allowed tariff is N55.43.
Lastly, Band E – Non-MD cost reflective tariff is N145.07 while allowed tariff is N39.44, Band E – MD1 cost reflective tariff is N207.35 while allowed tariff is N55.43 and Band E – MD2 cost reflective tariff is N207.35 while allowed tariff is N55.43.
Consumers kick
According to a Daily Trust report, the President of Nigeria Consumer Protection Network, Kunle Olubiyo, said any increment with the current service delivery means electricity consumers will be fleeced by utility companies.
He said there has not been an increase in power generation, transmission infrastructure or upscale of distribution networks despite band segmentation helping to triple the inflow of revenue in the last one year.
“If you increase across boards, what assurance will there be of cost-reflective service? The Performance Improvement Plan, and investment in infrastructure, in the last 10 years, have not brought about any increase in generation, transmission evacuation, and distribution.
“You can imagine that between 2015 to date, we’ve only added 400 megawatts, because as of the time of Jonathan’s administration, we celebrated equilibrium of generation, transmission, and distribution at 5,600 megawatts. And now, since 2015, when Jonathan was leaving, to date we’ve not been able to hit 600 megawatts.”
He added that the government needs to make decisions to reflect political economy and political sensitivity, adding they should put people at the heart of its policies.
“The bullets should not be fired simultaneously such that it may have unintended consequences politically for the present administration. So, tariffs should not be at the expense of enforcement or implementation of the commitment to service level agreement.”
On his part, the CEO at Sage Consulting & Communications, Bode Fadipe, said the issue of liquidity has been a major challenge in the sector which has affected investment.
He said as long as there is no right investment in the sector, the sector will not progress.
But there is also the second argument that at what point can you say that you have achieved cost reflectivity, given the number of adjustments that you have seen in the sector, vis-a-vis the performance of the sector itself? What has been the consequence?”
He added that Band A customers that have increased the revenue in the sector are still not enjoying the amount that they pay for 20 hours and above.
“When you come from that perspective, you then begin to wonder whether another adjustment, or what has been described as cost reflectivity, will solve the problem.”
He stated that this means cost reflectivity is not the only problem that is plaguing the sector.
‘We must stop concentrating on costs’
“Why are we not addressing the other issues, policy issues, for instance, that are plaguing the sector? Why is it that it is only costs that we are concentrating on, and we are not looking at other issues that are associated with the sector? These are fundamental things. I do concede that the liquidity issue has been a historical factor, but is it the only problem that requires the kind of attention that liquidity is receiving?”
“I know that Generation is being owed about N4tr and the government is wondering where will they get the money from as the market is under that burden, but is it cost reflectivity alone that will bring about a translation into the power sector that we all desire? So for me, I think we really need to sit down and do a critical examination of the sector, and not that we’ll just be adjusting price alone.”
An electricity consumer on Band C, Abubakar Aliyu, said he gets less than 6 hours of electricity daily and on some days his community in Gwagwalada would be in total darkness.
He said any increase in electricity tariff will have to come with increased service, adding that he doubts if the DisCos have the capacity to do it.
“It is just like the electricity is being rationed as the electricity fluctuates daily. This move will be very bad as we all know how poor the DisCos are in terms of service delivery and repairs of faults. Even if the government wants to increase the tariff, they should ensure everything is in order first.”
Super Falcons head coach Justine Madugu says he is not afraid of losing his job despite mounting pressure following Nigeria’s failure to qualify for the 2027 FIFA Women’s World Cup.
Madugu’s future has come under intense scrutiny after the Super Falcons suffered a 2-1 defeat to South Africa in the decisive CAF play-off in Morocco.
The loss ended Nigeria’s remarkable record of qualifying for every edition of the FIFA Women’s World Cup since the tournament began in 1991.
For the first time since 1991, Nigeria will miss the Women’s World Cup.
The pressure on Madugu intensified after the Super Falcons failed to secure automatic World Cup qualification at the WAFCON.
With calls growing for the Nigeria Football Federation (NFF) to make changes to the technical setup, Madugu insists he is prepared to accept whatever decision the football authorities make.
The coach said representing Nigeria has been a privilege and that he has no fear of being relieved of his position.
“I am not afraid of being sacked. To the glory of God, I have served my country. It was a privilege that was given to me,” Madugu said.
He added, “So far, I have played almost 28 games, won 19, lost four and drawn four. But this defeat came at crucial moments that people did not expect.”
Islamic cleric, Sheikh Ahmad Gumi, says it is the responsibility of the government to use public funds to support marriage arrangements in states operating under Shariah law.
In a post on his Facebook page on Thursday, Gumi argued that governments in Shariah-governed societies have a duty to address social needs arising from the prohibition of sexual relationships outside marriage.
The Islamic scholar noted that government intervention to assist people who cannot afford marriage should be viewed as part of responsible governance, especially where prostitution, fornication, adultery and promiscuity are prohibited by both religious principles and state laws.
According to him, public resources could legitimately be used to support young people in urgent need of marriage, as well as women who face limited opportunities to find suitable spouses.
“In a Shariah law-driven state, where prostitution, fornication, adultery, and promiscuity are prohibited by both divine and state laws, using public funds to facilitate the marriage of women who are in excess of the available pool of eligible men, or of any young person in dire need of marriage, is a legitimate and responsible component of good governance,” he wrote.
President Bola Tinubu decried the big task of successfully managing a democratic government, highlighting what he described as
It’s twists, turns, hills and valleys, even as the president assured Nigerians that the nation’s refineries will bounce back.
The President also lamented that the expected benefits from the introduction of Compressed Natural Gas (CNG) are going into the pockets of truck owners.
This came as the President of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), Comrade Salimon Akanni Oladiti, pleaded with President Tinubu to help stop the casualisation of workers in the oil industry.
Speaking when he received the NUPENG leadership at the Presidential Villa, Abuja, the President said the union has been a very good partner in government’s progress.
“You occupy a very critical nerve of the economy of this country,” he said.
He recalled the promise he made while seeking the presidency that he would remove the fuel subsidy and the threat by oil and gas workers to down tools. “We had threat of possible strike and something, and I served notice; you may strike all you want, but fuel subsidy will be gone. And today, to the benefit of our great country.”
“I will soon publish how it is being utilized,” he said, adding that workers at local, state and federal levels are reaping the benefits of subsidy removal through prompt payment of salaries, while landmark infrastructural projects are underway across the country.
“Yes, the economy is not child’s play. It’s a system of financial re-engineering and reset that you impress, and I want to thank you for the cooperation, collaboration and understanding.
“But I’m glad you have seen the effect of being able to find funding for long-term projects: Lagos–Ibadan Road, Abuja–Kaduna, Abuja–Kano, Sokoto–Badagry and other highways and road networks. It’s all for the good of our people and our economy.
“Equally, the introduction of compressed natural gas — well, I will appeal to you: we will do more and encourage you, but ask your drivers to let the benefits trickle down to commuters too, because whatever benefit is coming from CNG is going into the pockets of truck owners. It’s not spreading as fast as I would like, but it should spread.
“The refineries you mentioned are going to come back to work. We’re just building a very firm reset and structural reworking of the economics of it. Ordinary flame and smoke from a refinery doesn’t mean that it’s working until it’s profitable and yields the value for which it was built.
“I’m not a man who will look back and blame everyone, because I’ve accepted the assets and liabilities of my predecessors. No matter what happened in the past years, it’s my responsibility now as President to fix it and make it work for the greatest common good of our population. I take responsibility for that, and I’m going to do it.”
He added: “It’s not easy to manage a democratic regime, full of twists and turns, hills and valleys. But through perseverance, endurance and good determination we can bring about relief — like the joy of a newborn baby after a difficult pregnancy. Motherhood is painful, but the joy is everlasting. I promise you, you will enjoy a better Nigeria.”
Speaking earlier, NUPENG president Comrade Oladiti appealed to the President to check the casualisation of workers in the oil industry.
The NUPENG president, who described the trend as unwholesome, expressed concern that efforts to make oil companies, particularly in the upstream sector, stop the practice have been constantly rebuffed.
He said: “Your Excellency, our relationship with the international oil companies and indigenous players in the upstream sector has been very cordial. However, we want to seize this opportunity to bring to your attention an unhealthy trend we have been trying to correct with little to no success. It is the casualisation of workers, particularly in the upstream sector.
“For a sector that is strategic and taken as the economic jugular of the nation, NUPENG and its counterpart PENGASSAN have been tolerating these unwholesome practices, knowing full well the enormous disruption that any industrial action could cause to the economy.
“We also do not want to be seen as hostile to the Minister of Labour, Muhammad Maigari Dingyadi, who has been very supportive and operates an open-door policy in his relationship with our union.
“We have engaged the management of some of the affected companies without results. Mr. President, we urge you to use your good offices to stop the casualisation of workers in our sector.”
While commending the present administration for rehabilitation and dualisation of federal highways — which he noted will ease movement of petroleum trucks — Oladiti also appealed to President Tinubu to see to the resuscitation of the Nigerian Pipelines and Storage Company (NPSC) depots across the country.
He maintained that injecting life into the depots would complement the ongoing efforts to revive the ailing refineries.
He said: “We’ve seen real progress in the rehabilitation of federal highways, making journeys safer for our tanker drivers.
“We also want to commend your administration’s move to revive the Warri and Port Harcourt refineries through partnership with Chinese firms. Your Excellency, we humbly request that the same energy and drive to inject life back into the refineries be extended to the decaying Nigerian Pipelines and Storage Company depots across the country.
“We strongly recommend they be handed over to private investors to manage under an equity arrangement.”
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