Minister of Power Adebayo Adelabu has initiated a campaign to increase electricity tariffs, arguing that citizens must pay the appropriate price for energy consumed. This follows earlier statements by President Bola Ahmed Tinubu’s Special Adviser on Energy, Olu Verheijen, who emphasized that tariff increases are necessary to support maintenance, enhance reliability, and attract private investment. However, these proposals have been met with criticism amid persistent poor electricity supply across the country.

Adelabu previously proposed a “full cost-reflective tariff regime” in January 2024, citing that Nigerians pay the lowest electricity tariffs in West Africa compared to Ghana, Ivory Coast, and Niger Republic. Since May 2023, there has been a trend of increasing electricity tariffs, with the Nigerian Electricity Regulatory Commission (NERC) approving a 300% tariff increase for Band A consumers and 65% for other bands.

Despite these tariff increases, NERC data indicates a decline in electricity generation. In the fourth quarter of 2024, electricity generation was 9,289 GWh/h, down from 9,450.76 GWh/h in the third quarter. Average hourly generation also decreased from 4,280.24 MWh/h to 4,207.41 MWh/h. The total energy received by Distribution Companies (DisCos) fell from 3,445.13 GWh/h to 3,360.77 GWh/h.

The supply gap forces households and businesses to rely on self-generated power, impacting the economy, particularly small-scale businesses. The Presidency has also opted out of public power supply, budgeting N10 billion for solar energy installation.

Calls have been made for the Minister of Power to halt tariff increases and prioritize the national power reform programs. Emphasis is placed on addressing the metering gap. As of September 30, 2024, only 6,156,726 (46.15%) of the 13,339,635 registered electricity customers were metered, leaving 7.18 million customers unmetered. There are approximately 85 million Nigerians without access to electricity. The government has been urged to protect vulnerable consumers through targeted subsidies.

Additionally, the federal government plans to initiate reforms in the electricity distribution sector, starting with a pilot overhaul of two underperforming DisCos. This initiative follows an assessment of challenges, including governance gaps, infrastructure deficits, and commercial inefficiencies. The pilot scheme, set to commence between May and August 2025, will target one DisCo in the North and another in the South, aiming to demonstrate a replicable model for operational turnaround. The Japanese International Cooperation Agency (JICA) presented a roadmap for revamping the distribution sector, emphasizing internal restructuring, external expertise, and federal oversight.

Minister Adelabu stressed the urgency of the intervention, stating that regulatory authority will be used to restructure underperforming DisCos and ensure compliance.