- Nigeria’s Minister of Power, Adebayo Adelabu, has delayed plans to increase electricity tariffs due to current economic conditions, aiming to avoid potential public unrest.
- Transmission Company of Nigeria CEO Sule Abdulaziz cited insufficient funds, outdated equipment, and vandalism as major hurdles to effective electricity transmission.
In recent statements, Adebayo Adelabu, Nigeria’s Minister of Power, revealed that the government is postponing plans to adjust electricity tariffs due to the current economic climate. During an oversight visit by the House of Representatives Committee on Power in Abuja, Adelabu explained that the government aims to avoid policies that might provoke nationwide protests.
Adelabu outlined the proposed tariff structure: Band A consumers, who receive at least 20 hours of electricity daily, were slated to pay N200 per kWh; Band B consumers, with a minimum of 16 hours, were to pay N140 per kWh; and Band C, the lowest tier, would be charged N90 per kWh. However, these increases are currently unfeasible due to the prevailing economic mood.
He noted the disparity in electricity costs: Band A consumers pay N209 per kWh despite the average generation cost being around N120 per kWh, while Band B consumers pay N65. This significant underpayment indicates substantial government subsidies.
The minister highlighted progress in the power sector, noting that on August 8, 2024, the country achieved a generation, transmission, and distribution peak of 5,155.99 megawatts for the first time in three years. While this is an improvement from the 4,000 megawatts when the current administration took office, Adelabu stressed that the growth has been incremental, with an additional 2,000 megawatts achieved over 35 years.
Sule Abdulaziz, CEO of the Transmission Company of Nigeria (TCN), also addressed critical issues impacting electricity transmission. Abdulaziz pointed to insufficient funds for project completion, outdated equipment, and infrastructure vandalism as significant obstacles. Despite these challenges, TCN focuses on expanding grid visibility, maintaining equipment, and managing the network to ensure stability and efficiency.
To enhance grid stability, TCN has implemented Supervisory Control and Data Acquisition (SCADA) systems for real-time monitoring and control. This technology aims to improve grid stability, reduce transmission losses, and facilitate quicker fault response. Additionally, TCN is advancing digital transformation with homegrown solutions and vendor-procured applications.
Abdulaziz also highlighted several sectoral challenges: incomplete projects, insufficient funding for ongoing projects, difficulties in securing Right of Way (RoW) compensation, ageing equipment, and financial issues related to non-payment by Distribution Companies (DISCOs). He pointed out the lack of modern surveillance tools like helicopters and drones for transmission line inspections and delays caused by the Federal Ministry of Finance’s inability to release counterpart funding for donor-supported projects.
These challenges underscore the complexity of improving Nigeria’s power sector amidst financial and infrastructural constraints.