FG Moves to Hike Electricity Tariff Despite Economic Hardship

Despite growing economic challenges facing Nigerians, the Federal Government has disclosed ongoing plans to increase electricity tariffs further. President Bola Tinubu’s Special Adviser on Energy, Olu Verheijen, made this known during an interview in Dar es Salaam, Tanzania. She attended a World Bank-backed conference where Nigeria presented a $32 billion plan to improve electricity access by 2030.

According to her, private investors are expected to contribute $15.5 billion, while the remaining funds will come from public sources, including the World Bank and the African Development Bank. She emphasized that power prices in Nigeria must increase by about two-thirds for many customers to reflect the actual supply cost.

Verheijen explained that raising electricity tariffs is essential to maintaining infrastructure, improving service reliability, and attracting private investment in power generation and transmission. However, she acknowledged that subsidies would be required to cushion the impact on low-income households.

“One of the key challenges we’re looking to resolve over the next few months is transitioning to a cost-efficient but cost-reflective tariff,” Verheijen stated.

She added that achieving this would ensure the power sector generates the revenue needed to attract private capital while protecting the poor and vulnerable.

This announcement comes when Nigerians are already grappling with rising living costs. Recall that the Nigerian Communications Commission (NCC) recently approved a tariff increase for telecommunications services, further straining household finances.

The NCC’s Director of Public Affairs, Reuben Muoka, confirmed that the approval aligns with the commission’s regulatory authority under Section 108 of the Nigerian Communications Act, 2003. Telecom companies have long demanded tariff hikes due to escalating operational costs.

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