Minister of Power, Adebayo Adelabu has said that the pain that came with increased tariff in the country is a temporary phase which would pass.
While presenting his ministerial scorecard in Abuja on Friday, May 24, Adelabu said electricity distribution companies (DisCos) are now responsive to their duties because the Nigerian Electricity Regulatory Commission (NERC) has improved on its oversight over them.
He added that the electricity tariff will crash over time just like telecoms tariffs. Adelabu said;
“It might look expensive at the moment, I am optimistic that these tariffs will go down. We know how much we were buying SIM cards when telecoms first came. We know how much we were buying the telephone sets. But gradually, it scaled off.
“Generation, transmission and distribution, these prices will also go down. So, it is a temporary hardship and it will lead to permanent gain.”
The power minister further revealed that the Nigerian Electricity Supply Industry (NESI) has introduced a guaranteed service level for the Band A customers that get a minimum of 20 hours of supply per day, for the first time in Nigeria.
He said;
“For the first time in Nigeria, we have what we call guaranteed service level. It might be for Band A today, but no government has ever guaranteed 20 hours of supply, not to even 1% of consumers.
“But to 15% of consumers, we said let us start from here, and we have guaranteed service level for Band A customers with the introduction of cost reflective tariffs to that band, including liquidity conditions suitable for driving investment.”
He said the reforms in the NESI have attracted investments from the World Bank and the Nigerian Investment Sovereign Authority (NISA).
He credited the progress in the industry to the Electricity Act 2023, claiming that prior to the President Bola Tinubu reforms implementation, investors deemed NESI unattractive on account of what he called its uninspiring tariff policy and huge debt overhang.
Adelabu said;
“We have been able to attract investment into the sector because before now, nobody was ready to touch this sector because the tariff policy was not inspiring; the debt overhang was too much.
“Nobody wanted to bring capital. Even bankers didn’t want to lend anybody money. But now that is a thing of the past.
“The federal ministry of power has launched the Nigerian Power Investment Opportunities and Guidelines 2.0 that highlights some of the opportunities in the sector.
“We have also attracted $500 million dollars initiative from NSIA (Nigerian Sovereign Investment Authority) and the World Bank $750 million.
“We are beginning to see some progress from the outcome of the reforms process and key achievements of the administration in the last one year.”
He also insisted that the power sector has improved in the last one year, contrary to the impression in some quarters. Adelabu said;
“The question is, has power improved? Yes. It is no longer where we were in February, and the journey of a thousand mile starts with a step in the right direction. We are facing the right direction.”
