Economist Ayalowo Urges NERC to Revise Electricity Tariff Hike Amid Power Supply Challenges

Development economist Ayo Ayalowo has called on President Bola Tinubu’s administration and the Nigerian Electricity Regulatory Commission (NERC) to reassess the recent electricity tariff hike for Bands A, B, and C, citing ongoing power supply challenges faced by Nigerians.

Ayalowo’s remarks were made during an interview on Channels Television on April 16, 2024.

Ayalowo highlighted the significant impact of rising energy costs, particularly electricity and diesel, on Nigeria’s inflation rate.

He criticized the recent 240% electricity tariff increase for Band A customers, who are supposed to receive 20 hours of power supply. Despite the tariff hike, many Nigerians still experience inadequate power supply.

“The energy prices, especially this Band A, Band B, and C nonsense, need to be jettisoned.

And a sensible approach must be taken so that Nigerians can enjoy electricity at a reasonable cost,” said Ayalowo.

He suggested that a more equitable solution would be for the Minister of Power and NERC to implement a marginal tariff increase across the board, rather than the current system, which he described as “cheating Paul to pay Peter.”

Ayalowo’s comments come in the wake of NERC’s announcement on April 3, 2024, that the electricity tariff for Band A customers would increase from ₦66 to ₦225 per kilowatt-hour.

This has raised concerns about the affordability and accessibility of electricity for many Nigerians, who are already grappling with high living costs and limited power supply.

As the Tinubu administration works to address Nigeria’s energy challenges, the debate over the appropriate pricing and distribution of electricity continues to be a critical issue for the country’s economic stability and the well-being of its citizens.