According to the Nigerian Electricity Regulatory Commission (NERC), the newly approved electricity pricing is expected to result in a N1.14 trillion reduction in the fiscal year 2024 subsidy.
In a statement released on Wednesday in Abuja, Mr. Musliu Oseni, the Vice Chairman of NERC, made this announcement. To counteract the effects of macroeconomic shifts, Oseni claims, the Federal Government has indicated that it intends to switch to a tailored subsidy scheme.
” With the newly approved tariffs, subsidies for the 2024 fiscal year are expected to reduce by about NGN1.14 trillion in furtherance of the Federal Government’s realignment of the subsidy regime.
” While largely protecting vulnerable customers and fostering investments targeted at providing efficient service delivery in the Nigerian Electricity Supply Industry (NESI).
” The overarching objective of the commission in the consideration of the tariff application is the creation of a financially sustainable electricity market providing adequate and reliable power supply to drive the Nigerian economy.
” The commission, upon due consideration of the tariff applications, has approved revised rates affecting only customers classified under Band Serv category which is about 15 per cent of the customer population,” he said.
Additionally, Oseni clarified that in accordance with its established norms and business rules, the commission conducted a thorough evaluation of the rate proposals provided by the 11 Electricity Distribution Companies (DisCos).
He stated that the licensees’ performance improvement plans, which included a public hearing, were examined prior to the review procedure. Stakeholders and intervenors carefully examined the rate submission that the public utilities submitted during this hearing.
Empirical service data, according to Oseni, has verified that this client class has indeed gotten the committed level of service. In order to resolve service failures, he said, a system for enforcement and compensation has been put in place.
” All DisCos have been provided with mandatory targets for investments and migration of more customers to Band.
” The commission has established a robust monitoring framework leveraging on technology to ensure that the public has visibility of the service covenant with their service providers.
” We wish to assure all Nigerians that the commission working in collaboration with the policymakers remains committed towards providing adequate and reliable electricity to all citizens.
” This is as we work diligently with state governments to deliver on the gains of the Electricity Act 2023,” Oseni added.
