Band-A tariff hike has reduced electricity subsidy to N1trn- Adelabu

The Minister of Power, Adebayo Adelabu, has said that the introduction of higher tariffs for Band A users has reduced the electricity subsidy paid by the Government from about N3 trillion to N1 trillion.

Adelabu disclosed this at the public hearing on electricity tariffs in Abuja organized by the House of Representatives Joint Committee on Power, Commerce, National Planning, and Delegated Legislation on Tuesday.

While speaking at the public hearing, the Minister said without an increase in electricity tariffs, the expected subsidy would have been about N3 trillion which the Federal government cannot afford at the moment. 

He argued that the cost of electricity is still cheaper compared to premium motor spirit and diesel, even with the increase in electricity tariff, said Nigeria offers the cheapest electricity tariff in sub-Saharan Africa.

“Band A is cheaper compared to other sources of generating power. It is almost 50 per cent cheaper to connect to band A of the national grid than to run on fuel and diesel. So when we complain about the higher tariff, it is cheaper for any business to pay for a grid connection than to individually generate power” he said

The minister said the increase in tariff was not targeted at making life difficult for Nigerians but to make life affordable for the people.