Nigerians Pay Premium for Unavailable Electricity Amid 168% Tariff Hike in 8 Years

• Nigeria has suffered from electricity supply shortages for years, and the country’s power supply efficiency has hardly improved under the administration of President Muhammadu Buhari, despite increasing electricity tariffs by over 168% in the last eight years.

• According to a UK-based research company, Cable, Nigeria ranks 109th in terms of cheap electricity out of 230 countries measured. Nigerians pay between $0.15 to $0.17 for a kilowatt per hour, whereas countries such as Libya, Angola, Sudan, Kyrgyzstan, and Zimbabwe offer the cheapest cost of electricity.

• In contrast to the high cost of electricity, many Nigerians pay estimated bills for unavailable electricity and rely on generating sets for household and commercial supply. The stakeholders suggest the real income of consumers needs to be strengthened to balance the equation. It is time for the government to deal with electricity theft in the country and make examples of some individuals and corporate bodies caught in the despicable act.

Nigeria has faced electricity supply shortages, forcing many households and commercial customers to rely on generating power. Although President Muhammadu Buhari’s administration has increased electricity tariffs by more than 168% over the last eight years, there has been almost no improvement in the country’s power supply efficiency.

Meanwhile, the country ranks 109th in terms of cheap electricity out of 230 countries measured by a UK-based research company, Cable. While Nigerians pay between $0.15 to $0.17 for a kilowatt per hour, countries like Libya, Angola, Sudan, Kyrgyzstan, and Zimbabwe offer the cheapest cost of electricity.

Most stakeholders blame Nigeria’s despondent state of the sector on the policy mismatch of the Buhari government, insisting that it is out of place to compare Nigeria with the highest number of people without access to electricity with other countries.

Moreover, many Nigerians pay estimated bills for unavailable electricity and further depend on generating sets for household and commercial supply. As of January 2022, a consumer pays between N55 kWh to N71 kWh, depending on the categorisation.

However, residential electricity consumers were paying between N16 to N31 for one kilowatt per hour in January 2015, according to the Nigerian Electricity Regulatory Commission (NERC) Order 142 issued.

The report captured a lower exchange rate compared with the current situation.

However, even at a time when the minimum wage is N30, 000 and purchasing power is declining daily, Nigeria charges between $0.15 to $0.17 for a kWh.

The stakeholders suggest the real income of consumers needs to be strengthened to balance the equation.

In the current Multi-Year Tariff Order – 2022 (MYTO – 2022) approved by the NERC, consumers who were paying about N16 per kilowatt an hour in 2015 now pay about N55, while maximum demand customers under band A are paying about N71 to N80 for one kilowatt per hour.

Therefore, it is time for the government to deal with electricity theft in the country and make examples of some individuals and corporate bodies caught in the despicable act.