Small business owners and civil society organisations (CSOs) have strongly opposed the Federal Government’s plan to increase electricity tariffs for customers outside Band A, arguing that there is no justification for such a move.
This comes after the government revealed its consideration of the hike to improve liquidity in the Nigerian Electricity Supply Industry (NESI).
Speaking at the public presentation of the National Integrated Electricity Policy (NIEP) and the Nigeria Integrated Resource Plan (NIRP) in Abuja, Minister of Power, Chief Adebayo Adelabu, stated that the government could no longer sustain the N3 trillion power sector subsidy. He noted that debts owed to power generation companies (GenCos) have now reached N4 trillion, which he described as unsustainable.
“The key issue in the market is illiquidity, and we will continue to focus on sector reforms. We will look at the tariff again. I’m not saying we are going to increase it, but we will examine ways to improve on last year’s achievements to boost sector revenue and invest in infrastructure upgrades to ensure reliable electricity supply,” Adelabu stated.
The Minister highlighted concerns about the gap between Band B customers, who receive about 18 hours of power at N63/kWh, and Band A customers, calling it a pressing issue. He further emphasized that the proposed reforms would directly impact businesses by reducing power disruptions and fostering economic growth. The government’s plans include phasing out delayed electrification and self-generation by 2035, requiring an estimated $29.23 billion investment, which is expected to rise to $122 billion by 2045.
Stakeholders Condemn Proposed Tariff Hike
The Association of Small Business Owners of Nigeria (ASBON) has warned that another increase in electricity tariffs would cripple many small businesses.
ASBON President, Dr. Femi Egbesola, stated: “Most SMEs rely on government-supplied electricity. A further tariff hike will cause inflation, increased production costs, low sales, and ultimately lead to the collapse of many businesses, especially micro and small enterprises, which are the most vulnerable.”
Similarly, the Education Rights Campaign (ERC) vowed to resist any further increase, arguing that Nigerians are already struggling with poor electricity supply and frequent power grid collapses.
ERC’s National Coordinator, Hassan Taiwo, said: “The Federal Government should immediately abandon any plans to increase electricity tariffs. Power supply has not improved, and the frequent grid collapses prove that consumers are not getting value for money. This planned increase will be met with strong resistance.”
He further criticized the high cost of electricity, noting that many Nigerians spend a significant portion of their monthly income on power, leaving little for survival. Taiwo also pointed out that businesses and institutions, including hospitals like the University College Hospital (UCH) in Ibadan, have struggled to pay their electricity bills, affecting service delivery.
The Movement for Socialist Alternative (MSA) also rejected the proposed hike, accusing electricity providers of prioritizing profit over service improvement.
MSA General Secretary, Dagga Tolar, stated: “The Band A tariff increase was a strategy to divide consumers while falsely presenting DISCOs as capable of supplying 24-hour electricity. In reality, they have not invested in power generation, yet they continue to rake in billions without improving services.”
He urged the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) to organize protests and demand a new minimum wage that reflects the rising cost of living.
NERC Introduces Customer Bill of Rights
Meanwhile, in an effort to protect electricity consumers, the Nigerian Electricity Regulatory Commission (NERC) has introduced a Customer Bill of Rights and Obligations within the NESI framework.
According to NERC official Pious Bakom, “Customers are entitled to clear information on electricity rates, terms of service, and connection procedures. They must also pay bills on time, grant access for meter installation, and comply with safety regulations.”
NERC further advised consumers to notify their electricity distribution companies when vacating or occupying premises to avoid liability for outstanding bills. The commission emphasized that these regulations aim to align Nigeria’s electricity standards with global best practices.
