Band B Customers Not Paying Enough for Electricity — Minister
Electricity consumers in Band B may soon face higher bills as the Minister of Power, Adebayo Adelabu, revealed that they are currently underpaying for the electricity they receive.
Speaking at the Public Presentation of the National Integrated Electricity Policy (NIEP) and the Nigeria Integrated Resource Plan (NIRP) in Abuja yesterday, the minister noted a significant disparity between Band B, which receives up to 18 hours of electricity daily, and Band A, which gets a minimum of 20 hours.
He emphasized the need to harmonize the bands to address this gap.
Adelabu also mentioned that the government had anticipated a quicker transition of consumers from Band B to Band A.
However, this progress has been hindered by the reluctance of Distribution Companies (DisCos) to invest in their infrastructure.
“They have refused to invest in this sector. Fine, it can be explained in a way, but a lot of investment is required for us to achieve an accelerated migration of lower band customers into Band A. It is taking a lot of time.”
“We’re now not looking, okay, what can we do? Let’s even look at other bands, which is B to E. Let’s go now to the bands to A, B, and C, so that we can actually, because the gap between the Band A tariffs and the Band B, Band C, D, and E is just too wide. It’s just too wide. And a Band B that’s enjoying 18, 17 hours is paying N63.
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“One that’s enjoying just 20 hours, two hours difference of supply, is paying N209. So we believe it’s not fair. It is not just. And we must be able to carry out some level of regularization.”
He added that this is not tariff increase, because tariff would never go beyond what a Band A is paying.
“But we need to regularize, internal regularization of the tariffs among the existing bands. Try to be fair, it will be just, and it will come with minimal noise because a lot of Band A customers will say, downgrade us to Band B. If Band B can be getting 16, 17 hours. Then they also pay something close.”
“Nobody will come and say, ‘downgrade me to Band B again’. So we are just trying to juxtapose the numbers and also engage. We are not announcing any increase in lower band tariffs yet. If we want to do that, everybody will be carried along. I want to do proper engagement, and we know that it’s a joint sectoral agreement. Not just that, oh, the minister has announced, or the Chairman of NERC has announced. No, it will not happen like that. But we are reviewing the situation. Then, the subsidy implementation.”
He stated that the federal government owes electricity generation companies (GenCos) and electricity distribution companies (DisCos) over N4 trillion in electricity subsidies. This debt has hindered efforts to strengthen the power sector and provide optimal service delivery to consumers.
Breaking down the figures, the Minister explained that N2 trillion is owed to GenCos as legacy debt, while an additional N1.9 trillion is owed to them for the 2024 electricity subsidy.
Meanwhile, DisCos are owed N450 billion for the 2024 subsidy. He emphasized that the government cannot sustain the current electricity subsidy payment model and is considering a new approach that targets assistance to the most vulnerable segments of the population.
“How do you expect the GenCos to perform optimally? How do you expect them to pay for gas, service and maintain their turbines and other infrastructure as well as pay their staff? If a total of N4tr is being owed to them.”
(Daily Trust)
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