Minister of Power, Adebayo Adelabu, has defended the recent electricity tariff increase, asserting that manufacturers in the Band A classification will experience reduced energy costs and lower production expenses.
Speaking at the 8th Africa Energy Market Place (AEMP) in Abuja, Adelabu emphasized that with a consistent supply of at least 20 hours of power daily, these manufacturers will benefit from the tariff hike.
The National Electricity Regulatory Commission (NERC) recently raised the tariff for Band A electricity consumers from N66/kWh to N225/kWh, sparking widespread criticism.
The minister stated, “Those on Band A, if they should do their arithmetic properly, to compare what they have been spending on energy provision from grid supply and energy generators put together, before the review of tariff, they have achieved nothing less than 30 to 40 percent reduction in their total cost. That is the truth.
“We are also electricity consumers, so we can attest to this fact. It is true that if you are in Band A, your bill would have doubled if not more. But check out what you have been spending on your generator servicing, diesel, and petroleum procurement, it would have down considerably.
“So the argument of this new tariff having the capacity of increasing the cost of production and raising the prices of goods and services is not logical.
“Manufacturers under Band A should have a lower Energy cost by now, thereby, reducing their cost of production. Except those that have not been paying for electricity in the past.
“We can also come together to compare notes with practical example. But how this new tariff regime will increase the cost of production is not valid because I am in that industry too,” he added.
Labour unions and prominent figures, including human rights lawyer Femi Falana, have criticized the tariff hike, arguing that it will worsen inflation and economic conditions for Nigerians.
In response, Adelabu stressed, “The electricity tariff was not targeted at improvising Nigerians or worsening the already bad economic situation of the high inflation rate and naira losing value but targeted at resolving or reducing the hardship of the people.”
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