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Minister of Energy, Adebayo Adelabu
Defending the current hike in electrical energy tariffs, which has attracted wild reactions and resistance from Nigerians, Minister of Energy, Mr. Adebayo Adelabu, on Tuesday, mentioned that the introduction of upper tariffs for Band A customers has decreased the electrical energy subsidy paid by the Authorities from about N3 trillion to N1 trillion.
Adelabu disclosed this on the public listening to on electrical energy tariffs in Abuja on Tuesday, organised by the Home of Representatives Joint Committee on Energy, Commerce, Nationwide Planning, and Delegated Laws.
Adelabu, who said that with out a rise in electrical energy tariffs, the anticipated subsidy would have been about N3 trillion, talked about that the Federal Authorities may not afford to bear the price of N3 trillion in subsidies.
Adelabu, who argued that the price of electrical energy remains to be cheaper in comparison with premium motor spirit and diesel, even with the rise in electrical energy tariff, mentioned Nigeria affords the most affordable electrical energy tariff in sub-Saharan Africa.
“We’re nonetheless in regards to the least expensive, even in sub-Saharan, regardless of the tariff. Our neighboring international locations pay greater. So the worth isn’t comparable.
“Band A is cheaper in comparison with different sources of producing energy. It’s nearly 50 per cent cheaper to hook up with band A of the nationwide grid than to run on gasoline and diesel.
“So once we complain in regards to the greater tariff, it’s cheaper for any enterprise to pay for a grid connection than to individually generate energy,” he mentioned.
Nonetheless, Deputy Speaker of the Home of Representatives Benjamin Kalu reiterated that the Nigeria Electrical energy Regulatory Fee’s determination to extend electrical energy tariffs had generated wild resistance.
Based on him, whereas the NERC justified the tariff hike to handle mounting debt and make sure the continued functioning of the ability sector, the fears expressed by the plenty had been legitimate.
Mentioning {that a} sharp enhance in electrical energy tariffs would additional worsen the financial predicament already confronted by the plenty, he mentioned, “There are real considerations that greater utility payments ensuing from this tariff hike can have ripple results on operational prices for companies, doubtlessly resulting in elevated costs of products and companies.”
