On Monday, the Federal Government announced that it is reviewing the implementation process for a cost-reflective electricity tariff. Still, it stated plans to continue subsidizing power supply for vulnerable Nigerians.
The FG also said it would unbundle the Transmission Company of Nigeria by separating Transmission services from System and Market operations in Q1 2024.
This plan was revealed by the Minister of Power, Chief Adebayo Adelabu, in a statement issued by the Federal Ministry of Power in Abuja. Also, in the event, the Minister said that the key to long-term power transmission in the country is to separate the power transmission grid into regional grids to enable effective management.
Before this announcement, a false report stated that Discos was planning to increase tariffs. Still, it was debunked on Monday as power distribution companies reported no plan to raise tariffs starting January 1, 2024, stressing that the Nigerian Electricity Regulatory Commission had yet to issue any directive.
But in the statement from the Federal Ministry of Power in Abuja on Monday, the Minister was quoted as having stated that the process for implementing a cost-reflective tariff was ongoing.
Power tariffs are reviewed every six months to reflect the economic realities across the country, considering the inflation cost of gas required to fire most power plants.
THE STATEMENT READS,
- Our primary focus is enhancing distribution and transmission infrastructure to minimize technical and commercial losses. The need for more liquidity continues to be a significant challenge in the electricity market.
- We are currently reviewing the implementation process of a cost-reflective tariff, while the government will continue to subsidize power supply to those who are vulnerable in our society.
Read more: https://www.investingport.com/federal-government-insists-on-reviewing-electricity-tariffs-in-2024/