Are you ready for a possible electricity tariff increase? Customers on Band A feeders might need to prepare themselves as the electricity subsidy shortfall has risen significantly. The subsidy, paid by the Federal Government, soared to N181.63bn in September from N102.30bn in May.
In April, the Nigerian Electricity Regulatory Commission announced the removal of subsidy for Band A feeders, leading to a tariff increase to N225 per kilowatt-hour. This decision faced backlash from Nigerians, including labor unions and education institutions, as their bills tripled.
The subsidy figure fluctuated monthly, fueling speculations of more tariff increases in the future. Factors like the foreign exchange crisis are major drivers of the electricity subsidy, impacting the cost of power generation. The Minister of Power expressed concern over the rejection of power by distribution companies, urging them to take more energy to prevent grid collapse.
Overall, the electricity tariff landscape is evolving, with potential challenges and changes ahead.