Minister of Power Unveils Strategy for Improved Electricity Supply in Nigeria

In a recent press briefing in Abuja, Minister of Power Adebayo Adelabu shed light on his ministry’s initiatives and the administration’s strategy, under President Bola Ahmed Tinubu, to enhance power supply across Nigeria. Adelabu urged Nigerians to remain patient, assuring them that the reforms in the power sector would yield visible and sustainable results. Here are the key points from the briefing:

  • Prior to the tariff adjustment, the government subsidized 67% of electricity costs, with an estimated subsidy cost of approximately 2.9 trillion Naira for 2024.
  • After the adjustment, the estimated subsidy cost for 2024 reduced significantly to around 1.4 trillion Naira, marking a reduction of over 50% in subsidies alone.
  • The tariff increase was accompanied by a reduction in Band A feeders, with only 481 remaining out of over 1,000, affecting around 15% of total customers categorized as Band A.
  • Currently, slightly over 5 million customers are metered, leaving a gap of over 6 million customers.
  • Subsidized pricing will continue temporarily, with a plan to transition towards cost-reflective pricing in three years.
  • The tariff adjustment aims to test the concept of full payment for 20-24 hours of daily supply, addressing liquidity issues and making investments in the sector more viable.
  • The power sector faces significant infrastructure challenges, including obsolete equipment and vandalism.
  • DisCos failing to provide 20 hours of supply to Band A consumers will face sanctions.
  • DisCos are incentivized to migrate other bands to Band A to charge higher tariffs.
  • Despite the controversial ‘freezer’ example, energy consumption management remains critical.
  • Ongoing efforts include regulatory decentralization, investments in renewable energy, and infrastructure improvements.
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