The Minister of Energy, Sale Mamman, has stated that the electricity price increase proposed by the federal government will start in July.
In January, the Nigerian Electricity Regulatory Commission (NERC) announced an upward review of electricity tariffs throughout the country from 1 April. It later suspended the proposed tariff increase in March due to the COVID 19 pandemic.
However, at the public inquiry hearing on the energy sector recovery plan and the impact on the COVID 19 pandemic in the Senate on Tuesday 16 June, the Minister said that the subsidy to maintain current tariff levels was not sustainable.
“The impact of the COVID 19 pandemic has also affected our plan to reposition the electricity market towards financial sustainability under the Power Sector Recovery Programme (PSRP).
Originally, the regulator planned to carry out a tariff review in April 2020 after the conclusion of the public consultation on the tariff review, but due to COVID-19 and customer apathy, the proposed tariff review was delayed by three months.
This means that the subsidies needed to maintain current tariff levels must be maintained until July 2020 if the proposed tariff review is implemented. The current situation in the Nigerian energy sector is characterised by a high level of capital investment, which is largely dependent on donor funding, loans and budget allocations.
We do not expect any negative effects on projects for which we have already secured financing”. Sale said