Reversal Of Electricity Tariff Will Cost N575bn – FG

Mr Babatunde Fashola

Minister of Power

 

The Federal Government says that it will not go back on the 45 per cent increase in electricity tariff, adding that a reversal will cost over N575 billion.
The Minister of Power, Works and Housing, Mr Babatunde Fashola, stated this in Abuja on Tuesday when he briefed the Senate Committees on Labour and Power during a public hearing on the new electricity tariff.

The Nigeria Electricity Regulatory Commission ( NERC) announced a 45 per cent increment in electricity tariff earlier in January.
The Senate after considering a motion at plenary in January, directed that the tariff be reversed to enable the Senate to conclude hearing on the case.
However, the minister explained that the new tariff could not be reversed as it was necessary for the market to survive.
He said that a number of indices, such as borrowing rate for investors, exchange rate , availability and cost of gas, among others also contributed to the hike.
The minister pointed out that one of the reasons why the tariff had to go up was that a major component, a significant number of power plants depend on gas and that out of about 26 power plants, only about three are hydro.
“We were heavily dependent on gas, people were exporting gas because gas was selling outside the country at four dollars and it was selling for domestic use at one dollar,” he said.
The minister said that even with the recent hike in electricity tariff, Nigeria was still among countries with the lowest electricity tariffs in Africa and the world.
Fashola added that since 2005 when the power privatization process started till 2013 when it was concluded, every segment of government was involved and would share the blame if there was any failure.