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NERC: States Cutting Power Tariffs Required to Fund Subsidy

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The Nigerian Electricity Regulatory Commission (NERC) has stated that state governments lack jurisdiction over the national grid and power stations established under federal laws or operating with licenses issued by the commission.

 

 

The commission stated this in its reaction to the controversies generated by the Enugu Electricity Regulatory Commission’s decision to slash the Band A tariff.

In a notice on Thursday, the national power regulator advised state governments to reflect the wholesale costs in tariffs or be ready to pay subsidies for any tariff shortfall.

The commission acknowledged that states that have assumed full regulatory oversight over their intrastate markets are now authorized to create and regulate transactions in their state electricity markets, saying this extends to the development of tariff methodologies that shall apply to end-use customers in their respective states.

This came as the power distribution and generation companies warned that states’ absolute power to determine tariffs begins when they start generating and transmitting electricity.

The NERC, in its notice on Thursday, cautioned, “As states do not have jurisdiction over the national grid and over electric power stations established under federal laws/operating under licences issued by the commission; they must holistically incorporate the wholesale costs of grid supply to their states without any qualification or deviation in their design of tariffs for end-use customers in order not to distort the dynamics of the market or be prepared to make a policy intervention by way a subsidy for any deviation in the tariff structure that distorts the wholesale generation, transmission and legacy financing costs in the Nigeria Electricity Supply Industry.”

NERC said no institution would take decisions that expose the national grid and wholesale electricity market to a financial crisis in contravention of express powers granted to them by the constitution.

“The commission’s attention has been drawn to the increasing stakeholders’ concerns on the Tariff Order (Order No. EERC/2025/003) issued by the Enugu State Electricity Regulatory Commission, to its Licensee Mainpower Electricity Distribution Limited that relies exclusively on electricity supply (generation and transmission) from the national grid.

“NESI stakeholders have expressed concern about the consequences of the reduction of tariffs for Band A customers in MEDL’s network area to N160.4 per kWh and the freezing of tariffs of customers in the other bands on the wholesale generation and transmission costs, along with the financing costs for legacy obligations in NESI. It is pertinent to state that the N160.4 per kWh was arrived at largely by reducing the current average Generation Tariff of N112.60 per kWh to NGN45.75, with an assumption of a subsidy component, a difference of N66.85 per kWh.

“Section 34(1) of the EA places a statutory obligation on the commission to create, promote and preserve efficient electricity industry and market structures, and ensure the optimal utilisation of resources for the provision of electricity and we are also aware that EERC as a sub-national electricity regulator also has a similar statutory obligation in their enabling law; and neither NERC nor EERC as responsible regulatory institutions would take decisions that expose the national grid and wholesale electricity market to a financial crisis in contravention of express powers granted to them by the constitution,” the Federal Government agency said.

It informed all stakeholders that the commission is currently engaging EERC on their tariff order as it relates to any perceived area of misinterpretation/misunderstanding on wholesale generation and transmission costs on their import of power from the national grid and grants further assurances of its unwavering statutory commitment that the electricity market will be made whole in terms of cost recovery in compliance with the laws of the Federal Republic of Nigeria.

Meanwhile, the Association of Nigerian Electricity Distributors and the Association of Power Generation Companies said the Enugu Electricity Distribution Company and other states contemplating tariff reductions should wait till they start generating and transmitting their electricity before slashing tariffs.

The Chief Executive Officer of ANED, Sunday Oduntan, told Band A customers in Enugu State not to rejoice yet, saying there can’t be a 20-hour power supply at N160 per kilowatt-hour.

On Sunday, the Enugu Electricity Regulatory Commission announced the reduction of the Band A electricity tariff from N209/kWh to N160/kWh, asking MainPower Electricity Distribution Company to implement this from August 1.

The decision has since sparked crises as generation and distribution companies accused the EERC of attempts to create more financial burden in the power sector, saying no state should impose more subsidy obligations on the Federal Government that is still owing N5.2tn of unpaid shortfalls.

While the ERRC said it did its calculations well before dropping the tariff to N160/kWh, Oduntan warned that no state has the power to determine the cost of electricity at the moment, stressing that the states can only align with the tariff order of the Nigerian Electricity Regulatory Commission, except if the value chain totally belongs to them.

Earlier in a statement, Oduntan raised the alarm over growing consumer resistance to electricity bill payments following the tariff cut by the Enugu State Electricity Regulatory Commission, warning that the move threatens to destabilise the country’s fragile power sector.

He disclosed that since EERC announced a reduction in Band A tariffs, customers in other states have begun to demand similar cuts, with some outrightly refusing to pay their electricity bills.

The Chief Executive Officer of the Association of Power Generation Companies, Joy Ogaji, also shared the same sentiment. According to her, states cannot unilaterally fix tariffs because they do not produce electricity.

“The fact speaks for itself. The fact that EERC still regulates a product it does not produce at the state level, but from the wholesale market, they cannot unilaterally regulate that price,” she said.

Ogaji added that the EERC made reference to NERC’s tariff regulations, which assume a subsidy that she deemed imaginary because there is no written policy from the Federal Government stating that there is a subsidy, nor is there a financing plan to backstop the ever-growing and accumulating debts, which have impaired GenCos’ books.

“Their claim based on an imaginary subsidy is baseless. You can’t build something on nothing. Tariff documents are not child’s play. They form the fulcrum for many decisions, including business decisions, potential investors, and so on.

“This regulatory rascality will not be sustainable for decentralisation. Do you even have a justification for claiming a subsidy? Let’s assume there is one in a federal market, you have applied to be independent of? Can you eat your cake and still have it? How do you even claim this subsidy as a state? Unfortunately, we lack leadership in this sector,” she said.

Meanwhile, the EERC clarified that its recent tariff cut did not tamper with the prevailing cost of power generation in the country in any way. The commission maintained that, based on MainPower’s costs, there was no justification to keep the price of electricity for Band A at N209/kWh in the state.

In a statement by EERC’s Commissioner for Electricity Market Operations, Reuben Okoye, the agency maintained that although it inherited the current tariff regime, “the commission is focused on developing a sub-national electricity market that is transparent, accountable, reliable and sustainable and therefore will review utility costs of service to achieve its mandate to the people of Enugu.”

International News

Nigeria Missing As Saudi Arabia Names African Countries Eligible For eVisa

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Saudi Arabia has updated its tourist eVisa programme for 2026, limiting eligibility in Africa to only three countries as part of its list of 66 nations whose citizens can apply through the Kingdom’s online visa platform.

 

The move leaves most African countries, including Nigeria, outside the simplified entry scheme.

The electronic visa allows eligible travellers to visit Saudi Arabia for tourism, leisure activities, family visits and Umrah, excluding the annual Hajj pilgrimage. Applications are completed online, eliminating the need for embassy visits and lengthy visa processing.

Saudi authorities said the eVisa forms part of ongoing efforts to expand tourism, attract international visitors and simplify travel procedures through a fully digital application system. The visa is available only to citizens of approved countries and territories listed on the Kingdom’s official tourism portal.

Below is the list of African countries eligible for Saudi Arabia’s eVisa.

1. Mauritius

2. Seychelles

3. South Africa

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South Africa Says Over 53,000 Deported In Migration Campaign

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The South African government says more than 53,000 foreign nationals have been deported or repatriated since launching a “migration management” campaign five weeks ago.

Most were from Malawi, Zimbabwe, and Mozambique, officials say, and the number is likely to rise as repatriations and deportations continue.

South Africa is carrying out one of its biggest crackdowns on undocumented migrants in years, following weeks of anti-immigration protests that have seen violence, intimidation and looting.

Protesters have been demanding tighter border controls and mass deportations, accusing migrants of contributing to high unemployment, rising crime rates and collapse of public services.

The UN has warned against using migrants as scapegoats for South Africa’s socioeconomic challenges.

Anti-migrant activists have threatened to stage weekly protests to pressure the government until their demands are met, and there are fears the protests could turn violent.

The demonstrators had set an “unofficial deadline” of 30 June for all undocumented migrants to leave the country, which has seen many foreigners leave to escape violence and intimidation.

Several countries, including Ghana, Nigeria, Uganda and Kenya, have flown their citizens home in recent weeks.

Justice and Constitutional Development Minister Mmamoloko Kubayi announced on Sunday that 53,499 foreign nationals have been processed for deportation and repatriation, “which is dominated by the Malawians, followed by Zimbabweans and Mozambicans”.

“We are striving to achieve an orderly and regular migration which is mindful and sensitive to the concerns raised by our people, while observing human rights and dignity of all people in our country, irrespective of their citizenship and immigration status,” Kubayi told a news conference in Pretoria.

She said the repatriation and deportation process has helped them catch people who were wanted by the police for alleged criminal activity.

Authorities will continue to enforce its immigration laws, she added, but warned that protesters should not conduct unauthorised searches of homes and businesses that are suspected of sheltering undocumented migrants.

South Africa’s President Cyril Ramaphosa has acknowledged public concerns about immigration but has condemned attacks against migrants, warning citizens against taking the law into their own hands.

South Africa is the continent’s wealthiest nation and has long attracted migrants searching for better economic opportunities, some of whom enter the country illegally.

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FIFA Boss,Infantino Plans 64-Team World Cup

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Plans for a 64-team men’s World Cup are set to be assessed after the 2026 tournament, with Fifa boss Gianni Infantino saying the event needs to be “for the whole world”.

 

The proposal for an expanded tournament was put forward last year, and Infantino says the success of the expanded 48-team tournament means Fifa should look at how a 64-team World Cup could work.

“These are all issues that we will be examining after the World Cup,” Infantino told Swiss broadcaster Blue Sport, external when asked if the tournament could grow to 64 teams.

“When organising a World Cup, it’s important to organise it for the whole world – not just Europe and South America, but effectively the entire world. Every nation should be allowed to dream of participating in the World Cup.

“You can see that the quality of the teams is extremely high, and it’s getting higher and higher, all over the world. If you don’t give smaller countries a chance to participate in the World Cup, they’ll lack the incentive to keep improving.”

Infantino said that the first 48-team World Cup has been “a huge success”, citing the progression of nine out of 10 African teams to the knockout stages.

“At the last World Cup, there were only five teams from Africa,” he said. “That just goes to show how important it is to include all teams – to give them this opportunity to participate.”

The Fifa council approved the expansion of the World Cup from 32 to 48 teams in 2017.

An official proposal to boost the 2030 World Cup to 64 teams was put forward by South American governing body Conmebol in April 2025, but no decision has been reached.

The 2030 edition will be mainly co-hosted by Spain, Portugal and Morocco, with the three opening matches to be hosted by Argentina, Uruguay and Paraguay to celebrate the centenary of the competition. Uruguay hosted the first World Cup, in 1930.

Uefa president Aleksander Ceferin is among those to have dismissed the 64-team proposal, with the Slovenian saying it is a “bad idea” for both the tournament itself and the qualifying process.

Asian Football Confederation (AFC) president Sheikh Salman bin Ibrahim Al Khalifa agreed, saying further expansion would bring “chaos”.

Victor Montagliani, president of the governing body for football in North and Central America and the Caribbean (Concacaf), said the suggestion “doesn’t feel right” and he believes the expansion would damage “the broader football ecosystem”.

However, Andrew Giuliani, executive director of the White House’s World Cup task force, said the United States could consider making a bid to host the 2038 World Cup and would be able to “handle it” if expanded to 64 teams.

Fifa’s official position has always been it will discuss expansion ideas with stakeholders and it is duty bound to consider any proposals from council members.

The Fifa council would make the ultimate decision, but there are no signs it is something expected to happen imminently.

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